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DEBATERS'  HANDBOOK  SERIES 


SINGLE  TAX 


^ 


DEBATERS' 
HANDBOOK  SERIES 

American    Merchant    Marine 

Capital  Punishment  (3d  ed.  rev.  and 
enl.) 

Central    Bank   of    the   United    States 

Child   Labor    (2d   ed.    rev.   and   enl.) 

City  Alanager  Plan 

Commission  Plan  of  Municipal  Gov- 
ernment   (3d   ed.    rev.    and  enl.) 

Compulsory  Arbitration  of  Industrial 
Disputes  (3d  ed.  rev.  and  enl.) 

Compulsory    Insurance 

Conservation    of    Natural    Resources 

Debaters'    Manual    (2nd   ed.   enl.) 

Direct  Primaries  (3d  ed.  rev.  and 
enl.) 

Election  of  United  States  Senators  (2d 
ed.) 

Employment  of  Women 

Federal  Control  of  Interstate  Corpora- 
tions (2d  ed.  rev.  and  enl.) 

Free  Trade  vs.  Protection 

Government  Oynership  of  Railroads  (3d 
ed.  rev.  and  enl.) 

Government  Ownership  of  Telegraph 
and  Telephone 

Immigration  (2d  ed.  rev.  and  enl.) 

Income  Tax  (3d  ed.  rev.  and  enl.) 

Initiative  and  Referendum  (3d  ed.  rev. 
and  enl.) 

Compulsory  Military  Training 

AHnimum  Wage 

Monroe  Doctrine  (2d  ed.  rev.  and  enl.) 

Mothers'  Pensions 

Municipal  Ownership  (2d  ed.) 

National  Defense  Vol.  I 

National  Defense  Vol.  II 

Open  versus  Closed  Shop  (2d  ed.) 

Parcels  Post  (2d  ed.  rev.  and  enl.) 

Prohibition   (2d  ed.  rev.  and  enl.) 

Recall  (2d  ed.  rev.  and  enl.) 

Reciprocity 

Single  Tax  (2d  ed.  rev.  and  enl.) 

Trade  Unions  (2d  ed.  enl.) 

Unemployment 

Woman  Suffrage   (3d  ed.  rev.) 

World  Peace  (2d  ed.  rev.  and  enl.) 


Other  titles  in  preparation 

Each  volume,  %i.25  net 


Debaters^    Handbook    Series 


SELECTED  ARTICLES 


ON 


SINGLE   TAX 


Compiled  fep 

EDNA  D.  BULLOCK 


Second  Edition  Revised  and  Enlarged 

By  JULIA  E.  JOHNSEN 


THE  H  W.  WILSON  COMPANY 

NEW   YORK 

1917 


.y^'" 
%^^ 


Published  March,  1915 
Second  Edition,  August,  1917 


EXPLANATORY  NOTE 

This  Handbook  conforms  to  the  general  plan  of  the  Debaters' 
Handbook  Series  in  its  adaptation  to  the  needs  of  the  seeker  for 
general  information  as  well  as  for  the  debater. 

In  arrangement  it  follows  the  customary  sequence  of  brief, 
bibliography,  general,  affirmative  and  negative  reprints.  For  the 
brief  the  compiler  is  indebted  to  Mr.  Leo  Jones,  of  the  Buraeu 
of  Debate  and  Discussion,  University  of  Washington,  Seattle. 

Bibliography  of  the  subject  is  meager,  though  there  is  an  im- 
measurable literature,  much  of  which  is  not  itemized  in  the 
Handbook  because  it  is  comprehended  in  the  publications  of  the 
Joseph  Fels  Fund,  and  those  of  temporary  agencies  for  defeating 
tax  legislation.  The  bibliography  is  made  up  largely  of  literature 
that  will  set  the  subject  squarely  before  the  average  citizen's 
mind,  though  the  economic  student  of  the  abstract  theory  of  tax- 
ation has  not  been  ignored. 

Students  are  advised  to  make  use  of  the  Fels  Fund  publica- 
tions, the  numbers  of  the  Public,  and  the  Single  Tax  Review, 
and  the  publications  of  the  following  societies  : 

Equitable  Taxation  League  of  Missouri,  St.  Louis.  William 
Preston  Hill. 

American  Single  Tax  League,  27  Union  Square,  New  York 
City.     C.  H.  Ingersoll. 

Washington  Equal  Taxation  League,  Haller  Building,  Seattle, 
Wash.    C.  H.  Shields. 

Anti  Single  Tax  Association,  508  Massachusetts  Building, 
Kansas  City,  Mo. 

Land  Owners'  Protective  Association,  1401  Waldheim  Build- 
ing, Kansas  City,  Mo.    E.  B.  Silvers. 

Home  Rule  in  Taxation  League,  516  American  Bank  Building, 
Los  Angeles,  Cal. 
September,  1914,  E.  D.  B. 


3G6S85 


EXPLANATORY  NOTE  FOR 
SECOND  EDITION 

Since  the  first  publication  of  the  Single  Tax  Handbook  a 
fairly  large  bibliography  on  the  subject  has  become  available, 
references  to  which  are  included  in  this  revised  edition.  The 
handbook  is  brought  down  to  date  by  the  inclusion  of  late  re- 
prints in  the  concluding  pages,  and  by  a  revision  and  enlargement 
of  the  bibliography  and  brief.  For  more  exhaustive  information 
on  the  subject  the  student  is  especially  referred  to  The  Single 
Tax  Movement  in  the  United  States,  by  A.  N.  Young,  and  the 
Single  Tax  Year  Book,  published  by  the  Single  Tax  Review. 

Julia  E.  Johnsen. 


CONTENTS 

Brief 

General   Statement    ix 

The  Affirmative xiii 

The  Negative    xvii 

Bibliography 

General   References    xxi 

Affirmative  References   xxv 

Negative  References    xxxi 

Introduction  ^ 

General  Discussion 

Abbott,  Lyman.    Rights  of  Man Outlook  3 

Blackmar,  F.  W.     Tax  Reform Kansas  City  Star  10 

Local  Option  in  Taxation 

Commonwealth   Club  of    CaUfornia,   Transactions  13 

George,  Henry.     Single  Tax World  Almanac  32 

Huie,  A.  G.    Single  Tax  in  New  South  Wales Public  35 

Ingersoll,   Charles  H.     Present   Status   of  the   Single   Tax 

Movement  Here  and  Abroad. . Survey  38 

Single  Tax Outlook  43 

Tax    Reform    League    of    Seattle.      Erickson    Single    Tax 

Amendment    47 

Taxation  of  Land  Values  in  Canada Public  50 

Typical  Objections  to  Land  Value  Taxation Public  53 

Woollen,  Evans.     Third  View  of  the  Single  Tax 

Atlantic  Monthly  55 

Affirmative  Discussion 

Hall,  Bolton.     Land  Question  and  Economic  Progress 

Arena      61 


vi  CONTENTS 

Howe,  Frederic  C     Way  Toward  the  Model  City 

World's  Work      63 

/Johnson,  Tom  L.    Taxation  of  Land  Values 

Congressional  Record      ^j^^ 

Garland,  Hamlin.  Single  Tax  in  Actual  Application.  .Arena  75 
Garrison,  F.  W.  Case  for  the  Single  Tax.  .Atlantic  Monthly      81 

Land  Tax  in  Germany St.  Joseph  News  Press      93 

Nock,  Albert  Jay.     Community  That  Pays  Its  Own  Bills.. 

American   Magazine      94 

Nock,  Albert  Jay.    Why  Nature's  Way  Is  Best 

American  Magazine     103 

Ontario,    Canada.      Tax    Reform    and    Direct    Legislation 

League.    How  the  Farmer  Pays  City  Taxes 107 

Spillane,  Richard.     Taxing  Enterprise Outlook     no 

Tax  System  Created  a  Fortune Kansas  City  Times     117 

What  the  Single  Tax  Advocates  Claim  for  Their  Theory. . . 

Nebraska  State  Journal     1 18 

Negative  Discussion 

Fallon,  George.    Single  Tax  Explained 123 

Johnson,  A.  S.     Case  Against  the  Single  Tax 

Atlantic  Monthly     127 

Seligman,  Edwin  R.  A.  The  Single  Tax.   Essays  in  Taxation     140 
Seligman,  Edwin  R.  A.     Halving  the  Tax  Rate  on  Build- 
ings     Survey     161 

Shields,  Charles  H.     Single  Tax  Exposed 173 

Shortt,  Adam.     Single  Tax  in  Canada 

National  Tax  Association.    Proceedings     178 

Taylor,  Newton  M.    Criticism  of  the  Single  Tax 

Equity   Series     182 

Supplementary  Material  for  Second  Edition 

Brown,  James  R.    Plain  Talk  on  Single  Tax 201 

Danziger,  Samuel.    Single  Tax  and  American  Municipalities 

National   Municipal   Review    210 


CONTENTS 


Vll 


Ingersoll,  C.  H.    War— or  Scientific  Taxation 

Annals  of  the  American  Academy    214 

Hilliard,  Sydney  L.     Rent  and  the  Cost  of  War 

Temple  Artisan    219 

Leubuscher,  Frederic  C.     Shifting    of    Taxation    to    Land 

Values  as  a  Means  of  Relieving  Congestion  and  Poverty 

...Conference  of  Charities  and  Correction.  Proceedings  222 
Johnson,  Lewis  Jerome.     Single  Tax  in  Relation  to  Public 

Health    229 

Williamson,  C.  C.    Shall  New  York  City  Untax  Buildings. . 

Survey    2.2^7 

Averill,  A.  H.  Argument  Submitted  in  Opposition  to  the 
Full  Rental  Value  Land  Tax  and  Homemakers'  Loan 
Fund  Amendment 240 


BRIEF 

_  ,  ,  ,  ,  by  per  ,  __ 

Extension  Bulletin,  No.  6,  University  of  Washington,  Seattle. 

Resolved,  That  all  public  revenues  should  be  raised  by.  a 
single  tax  on  land  values ;  constitutionality  granted. 

General  Statement 

Henry  George  is  often  spoken  of  as  being  the  originator  and 
founder  of  the  Single  Tax  doctrine.  Such  is  not  the  case.  The 
plan  of  raising  all  revenues  for  public  purposes  by  a  tax  as- 
sessed against  some  single  kind  of  property  or  based  on  some 
single  criterion  of  wealth  or  ability  is  not  a  new  one.  There 
have  been  economists  and  tax  reformers  in  the  last  two  hun- 
dred years  who  have  proposed  single  taxes  on  expenditure, 
houses,  incomes,  capital,  and  land.    > 

The  theory  of  the  Single  Tax  on  land  values  such  as  proposed 
by  Henry  George  was  promulgated  a  great  many  years  before 
Mr.  George  presented  it.  Adam  Smith  in  his  "Wealth  of  Na- 
tions" recognized  the  fundamental  basis  of  the  land  value  tax, 
namely,  that  land  values  are  created  by  society  and  not  by  the 
individuals  owning  the  land.  But  the  doctrine  was  first  fully 
conceived  and  formulated  by  a  French  school  called  the  Physio- 
crats. Henry  George  himself  recognized  this  and  dedicated 
his  book,  "Protection  and  Free  Trade,"  "To  the  memory  of  those 
illustrious  Frenchmen  of  a  century  ago,  Quesnay,  Turgot, 
Mirabeau,  Condorcet,  Dupont,  and  their  fellows,  who  in  the 
night  of  despotism  foresaw  the  glories  of  the  coming  day." 

The  theory  of  the  Physiocrats  may  be  briefly  set  forth  as  fol- 
lows :  Land  is  the  only  source  of  new  wealth  and  therefore  the 
cultivation  of  the  soil  is  the  only  really  productive  industry. 
Agriculture  yields,  in  addition  to  the  returns  on  labor  and 
capital,  a  net  product  which  is  called  rent.  Since  no  new  wealth 
can  come  from  any  other  source  all  taxes  must  of  necessity  come 
out  of  rent.  H  placed  on  other  things,  they  would  be  simply 
shifted  to  the  owner  of  the  land.  All  revenues  should  therefore 
be  raised  by  a  single  tax  on  the  rent  of  land. 


X  BRIEF 

Later,  John  Stuart  Mill  did  much  to  develop  the  single  tax 
on  land  theor>'.  Mill  laid  great  stress  on  the  fact  that  there 
is  an  enormous  unearned  increment  in  the  increase  in  land 
values  due  to  the  growth  of  population,  formation  of  cities 
and  other  influences  outside  the  individual.  About  1870  Mill 
was  president  of  a  Land-Tenure  Reform  Association  in  England. 
The  following  is  an  extract  from  their  program. 

"IV.  To  claim  for  the  benefit  of  the  State,  the  Interception 
by  Taxation  of  the  Future  Unearned  Increase  of  the  rent  of 
land,  (so  far  as  the  same  can  be  ascertained),  or  a  great  part 
of  that  increase,  which  is  continually  taking  place  without  any 
effort  or  outlay  by  the  proprietors,  merely  through  the  growth 
of  population  and  wealth ;  reserving  to  owners  the  option  of 
relinquishing  their  property  to  the  State,  at  the  market  value 
which  it  may  have  acquired  at  the  time  when  this  principle  may 
be  adopted  by  the  Legislature."  This  differs  from  Mr.  George's 
plan  only  in  that  it  applies  to  future  and  not  to  all  unearned 
increment  past  and  future. 

To  Henry  George  belongs  the  credit  of  fully  working  out  the 
Single  Tax  philosophy  in  its  economic  and  social  aspects  and  of 
stating  the  theory  in  a  popular  and  effective  form.  His  great- 
est work,  "Progress  and  Poverty,"  was  finished  in  1879.  It 
has  been  translated  into  several  foreign  languages  and  has 
aroused  much  interest  and  comment  in  all  the  civilized  nations. 
The  essence  of  the  Single  Tax  doctrine  is  well  stated  in  the  fol- 
lowing extract  from  Henry  George:  "All  men  are  equally 
entitled  to  the  use  and  enjoyment  of  what  God  has  created  and 
of  what  is  gained  by  the  general  growth  and  improvement  of 
the  community  of  which  they  are  a  part.  Therefore,  no  one 
should  be  permitted  to  hold  natural  opportunities  without  a 
fair  return  to  all  for  any  special  privilege  thus  accorded  to  him, 
and  that  value  which  the  growth  and  improvement  of  the 
community  attach  to  land  should  be  taken  for  the  use  of  the 
community." 

In  practical  application  the  full  Henry  George  Single  Tax  has 
never  been  tried,  but  an  approximation  of  it  is  in  force  in 
several  parts  of  the  world,  and  it  may  be  said  that  the  general 
tendency  of  tax  reform  in  all  countries  is  toward  the  higher 
taxation  of  land  values.  The  Australasian  tax  system  includes 
a   modified    Single    Tax.     It   is    in   operation    in    New   Zealand 


BRIEF 


XI 


and  many  parts  of  Australia.  It  permits  any  county  to  exempt 
from  taxation  all  improvements  and  capital  invested  in  pro- 
ductive industry.  In  1892  New  South  Wales  adopted  a  land 
tax  and  in  1901  Queensland  exempted  nearly  all  improvements 
from  taxation.  Vancouver,  Victoria,  Edmonton  and  other  urban 
and  rural  municipalities  of  Western  and  Northwestern  Canada 
have  land  value  taxes,  from  which  they  raise  the  bulk  of  their 
revenues  for  local  purposes.  In  Manitoba  all  improvements  in 
or  on  land  are  exempt  and  taxes  are  levied  upon  "prairie 
values"  alone. 

At  the  November  election  in  1912  the  people  of  Oregon 
rejected  the  Single  Tax  at  the  polls.  In  Washington  several 
attempts  have  been  made  to  secure  the  adoption  of  a  tax  on  land 
values  as  a  part  of  the  system  of  local  taxation.  Everett  adopted 
such  a  tax  two  or  three  years  ago  and  a  few  months  afterward 
repealed  the  law  upon  the  adoption  of  a  new  charter.  Last 
election  in  November,  1912,  it  was  again  adopted.  The  Everett 
charter  provides  for  an  exemption  of  twenty-five  per  cent  of 
the  personal  property  and  improvements  of  the  city  in  the  year 
1913,  fifty  per  cent  in  1914,  seventy-five  per  cent  in  1915  and  then 
total'   exemption    of    improvements,    placing   the    entire    tax    on 

land  rental.  ,  •  u  1 

There  have  been  two  distinct  lines  of  argument  which  have 
been  put  forth  in  support  of  the-_Singl£--Iax.  Isaac  Sherman 
and  his  followers  favored  the  Single  Tax  because  they  thought 
that  the  tax  would  be  shifted  to  the  consumers  and  would  thus 
be  diffused  and  every  person  would  bear  some  share  of  the 
taxes.  Hienry  George  and  his  followers  advocated  the  tax  for  a 
reason  fundamentally  opposed  to  this,  namely,  that  the  tax 
would  stay  where  it  was  put  and  could  not  be  shifted.  Econo- 
mists are  agreed  that  the  latter  view  is  correct  and  that  whatever 
the  other  objections  to  the  tax  the  contention  that  it  can  be 
shifted  to  any  considerable  extent  is  untenable. 

Two  classes  of  persons  have  opposed  the  adoption  of  the 
Single  Tax— conservatives  who  fear  the  results  of  the  appropria- 
tion by  society  of  rent,  and  socialists  and  other  radicals  who 
regard  the  Single  Tax  as  a  half-hearted  measure  which  will  not 
remedy  the  fundamental  defects  of  the  social  and  industrial 
organization. 

The  conservatives  are  undoubtedly  right  when  they  say  that 


xii  BRIEF 

the  full  application  of  the  Single  Tax  amounts  to  the  socialization 
of  land,  the  abolition  of  private  property  in  land  as  we  now 
have  it,  the  government  becoming  the  universal  landlord  and 
the  selling  value  of  land  tending  to  approach  nothing.  The 
very  theory  upon  which  Single  Tax  is  founded,  namely,  that  land 
values  are  God  given  or  socially  created,  is  inconsistent  with  the 
institution  of  private  property  in  land,  the  essential  element  of 
which  is  the  private  right  to  the  income  from  these  natural 
or  social  values.  There  would  still  remain  under  the  full  Single 
Tax  the  right  of  possession  and  of  alienation,  the  right  to  use 
the  land  for  productive  purposes  with  full  control  and  ownership 
of  the  results  of  labor  expended  on  the  land  and  improvements 
made,  but  the  bare  land  itself  would  pay  back  to  society  in  the 
form  of  taxes  the  full  value  which  the  presence  of  society  gave 
to  that  land.  There  would  be  community  but  not  common 
ownership  of  land. 

From  the  standpoint  of  the  socialist  doctrine,  the  socialists 
are  correct  in  their  contention  that  the  socialization  of  land 
would  not  greatly  modify  what,  to  them,  is  the  fundamental 
defect  in  our  industrial  organization — the  capitalistic  system  of 
production.  Free  land  does  not  mean  equality  of  opportunity 
because  those  with  capital  to  improve  land  would  have  a  great 
advantage  over  those  without  capital.  The  poor  man  has  no 
capital  and  would  be  unable  to  improve  the  land.  The  land 
therefore  would  be  held  and  improved  as  at  present  by  the 
capitalist  class  and  the  poor  man  would  continue  to  compete 
for  the  opportunity  to  sell  his  labor.  Some  socialists  are 
opposed  to  the  Single  Tax  because  they  feel  that  it  would  rivet 
the  chains  of  the  workingman.  Others  believe  in  it  as  a  step 
toward  the  socialization  of  all  of  the  instruments  of  production. 

It  is  evident  from  what  has  been  said  that  the  full  Single  Tax 
is  by  no  means  merely  a  tax.  It  is  a  plan  of  reorganization  of 
society  with  a  primary  view  of  securing  a  more  equal  distribu- 
tion of  wealth  and  incidentally  raising  revenues  for  the  govern- 
ment. 

Properly  speaking,  the  term  "Single  Tax"  as  applied  to  the 
systems  of  taxation  advocated  by  present  day  Single  Taxers  is  a 
misnomer.  The  system  which  is  usually  proposed  is  not  a 
"single,"  but  includes  other  taxes,  such  as  franchise  taxes  and 
taxes  on  all  monopoly  profits,  in  addition  to  the  land  value  tax ; 


BRIEF  xiii 

some  of  the  Single  Taxers  would  retain  repressive  taxes,  such 
as  the  liquor  license ;  others  would  include  the  inheritance  tax 
as  a  part  of  their  program.  Also,  the  tax  is  usually  proposed 
as  a  local  tax  and  not  as  a  state  or  national  tax,  but  most  of  the 
adherents  of  Single  Tax  look  upon  the  adoption  of  the  Single 
Tax  for  local  purposes  as  merely  a  step  toward  its  application 
in  the  larger  units  of  government. 

The  advocates  of  the  Single  Tax  are  also  to  be  discriminated 
between  those  who  hold  the  pure  Henry  George  doctrine  of  ap- 
propriation of  the  full  rental  value  of  land,  which  has  come  to 
be  known  as  the  Single  Tax  unlimited,  and  those  who  hold  that 
only  the  necessary  per  cent  of  rental  value  should  be  taken  to 
meet  the  actual  expense  of  government,  the  view  propagated 
especially  by  Thomas  G.  Shearman  and  C.  B.  Fillebrown  and 
known  as  the  Single  Tax  limited. 

To  the  Single  Taxers  are  ascribed  large  activities  with  move- 
ments for  lical  option  or  home  rule  in  taxation,  tax  reform 
measures,  and  movements  for  the  separate  assessment  of  land 
and  improvements,  as  being  steps  in  the  direction  of  the  pure 
ideals  they  have  in  view  as  an  ultimate  goal. 

The  Affirmative 

All  public  revenue  should  be  raised  by  a  Single  Tax  on  land 
values,  because 

I.     The  present  nationaLstate,  and  local  taxes  are  fundament- 
'  ally  defective,  for 

A.  They   are  taxes   on   industry   and   improvements,    and 

industry  and  improvements  should  npt-^e  taxed,  for 

1.  Taxes  falling  on  the  products  of  labor  discourage 

their  production. 

2.  Taxes  falling  on  improvements  lessen  the  amount 

of  improvements. 

B.  They  are  unjust  taxes,  for 

1.  They  can  be  easily  evaded. 

2.  They  can  to  a  considerable  extent  be  shifted. 

3.  The}^  bear  heavily  on  the  poor. 

4.  All  taxes  on  the  products  of  individual  labor  are 

unjust  when  society  has  a  fund  of  its  own  from 
which  to  draw  its  revenues. 


xiv  BRIEF 

C.     They   are    expensive,    complex,    and    cumbersome,    for 
I.     They  are  levied  on  a  great  variety  of  objects  and 
require  complicated   machinery,   and   duplication 
of   machinery,   for   their  assessment  and  collec- 
tion. 
II.     The  Single  Tax  on  land  values  will  do  away  with  the  de- 
fect of  the  present  system,  for 

A.  It  wiH  exempt  industry  and  improvements  from  taxa- 

tion, for 
I.     Land  will  bear  the  entire  burden. 

B.  It  is  a  just  tax,  for 

I.     It  cannot  be  evade^for 

a.  Land  cannot  be  concealed  or  carried  off. 

b.  Land  values  can  be  easily  determined. 

(i)     The  Somer  system  will  ensure  fair  valua- 
tion. 
2.     It  cannot  be  shifted,  for 

a.  It  will  be  paid  out  of  rent. 

b.  Landlords    cannot    pay  the    tax   from   an   in- 

crease in  rents,  for 
(i)     Rents  depend  on  supply  and  demand. 

c.  Economists   are   agreed    that    the    Single   Tax 

cannot  be  shifted. 

3.  It  avoids  double  taxation. 

4.  It  gives  social  benefits  to  those  who  pay  for. them. 

5.  It  is  a  burden  on  no  one,  for 

a.  The   fund  upon  which  it  draws  is  created  by 

society,  for 
(i)     All  land  values  and  increase  in  land  values 
are  due  to  the  presence  of  society,  for 

(a)  If  society  were  not  there  the  land 

w^ould  have  no  value. 

(b)  Individual  labor  or  improvements  do 

not  add  to  the  value  of  the  bare 
land. 

b.  It  merely  takes  from  the  land  owner  the  un- 

earned increment  of  land  due  to  presence 
of  society  which  increment  is  a  social  and 
not  an  individual  product. 

c.  Industry,  thrift  and  initiative  are  not  penalized. 

d.  It  taxes  non-beneficial  wealth. 


BRIEF  XV 

C.  It  is  a  simple  tax,  for 

1.  Tliere  is  one  object  of  taxation,  land  values. 

2.  Little  machinery  is  necessary  in  order    to  assess 

and  collect  a  tax  on  land  values  only. 

D.  It  is  an  adequate  tax,  for 

I.  It  has  a  large  fund  from  which  to  draw  revenue  in 
the  annual  rental  value  of  land  and  in  the  in- 
crease in  value  of  land  from  year  to  year. 

E.  It  is  an  elastic  tax,  for 

I.     The  amount  of  revenue  raised  by  the  tax  can  be 
automatically  raised  or  lowered  by  changing  the 
rate,  for 
a.     The   fund  on  which  it  draws   is  much  larger 
than  is  necessary  for  all    governmental    ex- 
penditure. 
III.     The  single  tax  on  land  values  will  bring  about  desirable 
economic  and  social  re-adjustments  which  will  be  bene- 
ficial, for 

A.  It  will  break  up  land  monopoly,  which  is  greatly  to 

be  desired,  for 

1.  Idle  land  will  be  forced  into  the  market,-  for 
a.     It  will  be  taxed  at  its  full  value. 

b.     Speculators  and  monopolists  will  not  be  able  to 
hold  it  out  of  use  and  pay  taxes  on  it. 

2.  Monopoly  has  been  and  is  a  cause  of  serious  in- 

ternal and  external  difficulties  of  nations, 
a.     Greece,  Rome,  Mexico,  England,  Ireland. 

B.  The  condition  of  the  laboring  classes  will  be  improved, 

for 

1.  Poverty  will  be  diminished,  for 

a.  The  cost  of  living  will  be  reduced,  for 
(i)     Monopoly  of  privilege  wilt  cease. 

b.  Natural  resources  will  be  conserved,  fc^r 

(i)  They  will  be  taxed  what  the  privilege  of 
development  is  worth  with  a  check  on 
excessive  profits. 

2.  Wages  will  be  increased,  for 

a.  Employers  will  be  obliged  to  pay  working- 
men  the  equivalent  of  what  they  could  pro- 
duce on  the  land,  for 


xvi  BRIEF 

(i)     Land  will  be  available  to  anyone  who  will 

put  it  into  productive  use. 

b.     The   opening  up   of   the  vast   areas   now  held 

out  of  use  for  purposes  of  speculation  will 

give  a  great  amount  of  employment  to  labor. 

3.     Housing  conditions  will  be  improved,  for 

a.  Owners  of  cheap  tenements  will  have  to  build 
better  buildings  in  order  to  get  sufficient 
income  to  pay  the  taxes  on  the  land  value. 

b.  The  exemption  of  improvements  will  stimulate 

building. 

c.  Tenancy  will  be  reduced,  for 

(i)     Homes  will  be  easier  to  get 

d.  Lower  rents  will  result. 

C.  The  farmer  will  be  benefited,  for 

1.  The  products  of  his  labor,  such  as  crops,  his  im- 

provements,    implements,    stocks,    etc.,     will     be 
exempt  from  taxation. 

2.  He  will  actually  pay  less  taxes  than  at  present,  for 
a.     The  vast  holdings  of  idle  land  in   both  cities 

and  rural  districts  will  bear  their  just  share 
of  the  taxes. 

D.  The  urban  community  will  be  benefited,  for 

1.  Capital,    industries   and   improvements   will   be   at- 

tracted. 

2.  The  size  of  towns  will  be  less  undesirably  abnor- 

mal, for 

a.  Vacant  lots  w-ill  be  built  up. 

b.  Outlying  development  will  be  more  regular. 

3.  Social   service,   protection    and   advantages    can   be 

extended  more  fully  and  economically  to  all  resi- 
dents. 
IV.     The  Single  Tax  on  land  values  has  succeeded  where  it  has 
been  tried,  for 

A.  It  has  greatly  benefited  Vancouver,  Victoria,  Edmon- 

ton and  other  Canadian  municipalities. 

B.  It  has  worked  well  in  New  Zealand  and  Australia. 

C.  Taxes  with  some  Single  Tax  features  are  being  used 
successfully  by  England,  Germany  and  other  Euro- 
pean countries. 


BRIEF  xvii 

D.  It  has  been  put  into  operation  to  some  extent  in  the 
United  States,  in  Pittsburg,  Scranton,  Houston,  Har- 
vard, Fairhope,  Alodesto,  Pueblo. 

The  Negative 

Pubhc  revenues  should  not  be  raised  by  a  Single  Tax  on  land 
values  because 

I.     The  present  system  of  taxation  is  not  inherently  defective, 
for 

A.  On  the  whole,  it  is  in  harmony  with  the  great  prin- 

ciple of  taxation  that  each  individual  should  con- 
tribute to  the  support  of  the  government  in  pro- 
portion to  his  ability  to  pay,  for  i/ 

1.  Property  taxes   form  the  basis   of  our   system   of 

taxation. 

2.  Property  is  one  of  the  best  evidences  of  ability  to 

pay. 

B.  It  is  a  diversified  system,  and  diversification  in  a  tax- 

ing system  is  desirable,   for 

1.  If  any  injustice  results  from  one  tax  it  is  apt    to 

be  equalized  or  mitigated  by  the  other  taxes. 

2.  A  diversified  system  is  a  more  certain  source  of 

revenue,  for 
a.     If  one  source  fails,  others  can  be  drawn  upon. 

3.  It  affords  greater  elasticity. 

4.  It    requires    some    contribution     from     practically 

every  citizen. 

5.  It  permits  the  application  of  taxes  for    social    or 

political  purposes. 

6.  It  justly  permits  personal  property  to  pay  its  own 

protection,  as  fire,  poHce,  etc.,  to  which  over  one- 
half  the  revenue  of  a  city  may  be  allotted. 

C.  The    specific    defects    in   the   present    system    can   be 

remedied  by  specific  reforms  without  overthrowing 
the  ent44:£  .systenij^Tor^ 
I,  The  greatest  evil  of  the  present  system  of  state 
and  local  taxation — evasicn — can  be  done  away 
with  by  the  classification  of  property  for  purposes 
of  taxation  and  by  the  taxation  of  different 
classes  at  different  rates,  for 


xviii  BRIEF 

a.  If  a  low  rate  is  placed  on  intangible  and  other 

personal  property,  the  tax  will  not  be  evaded. 

b.  The  classified  property  tax  has  practically  done 

away   with    evasion    in    the    states    where    it 
has  been  adopted. 

2.  Injustices  in  the  present  system  can  be  remedied 

by  the  extension  of  progressive  inheritance 
taxes  in  the  states  and  the  adoption  of  a  pro- 
gressive income  tax  by  the   federal  government. 

3.  The   separation    of    state    and    local    taxation    will 

secure    greater    simplicity    and    effectiveness    in 
the  taxing  system. 
II.     Viewed_saLely -as-a^-System  of  taxation^  the  Single  Tax  in 
land  values  is  defective,  forj^^***--    • 
A.     It  is  unjust,  for  ^"^   ^M'"*' 

1.  It  fails  to  conform  to  the  canon  of  taxation  that 

all  should  pay  taxes  in  proportion  to  their  ability 

to  pay,  for 
a.     It  taxes  individuals  only  in  proportion  to  the 
value  of  the  land  which  they  own. 

b.  It  taxes  the  poor  men's  land  and  exempts  the 
rich  men's  personal  property,  mansions,  sky- 
scrapers,  and   factories. 

c.  It   takes   no   consideration   of   income,   produc- 

tiveness of  property,  or  any  of  the  evidences      / 
of  ability  to  pay.  J 

d.  It  exempts  nearly  all  monopolies  and  trusts.  y 

2.  It  discriminates  against  a  certain  class  in  society 

— the  farmers,  for 
a.     It  compels  them  to  bear  an  undue  share  of  the 

burdens  of  taxation.  ^^ 

3.  It   discriminates    against    one    of   the    elements    of 

prooduction,  for 
a.     Labor  and  capital  should  also  bear  some  of  the 
burden  of  taxation,  for 
(i)     There  are  socially  created  values  in  labor 
and  capital  as  well  as  in  land,  for 
(a)     The    products    of    labor    owe    their 
value  to  the  presence  of  society. 


BRIEF  xix 

(b)  The    factory    and    store    would    be 

worthless  if  society  did  not  offer 
a  market  for  their  products. 

(c)  The   business    man's  profits   and   the 

income    of    the   professional   man 
are  socially  created  values. 

(d)  Houses  and  all  other  improvements 

have    the    same    kind    of    socially 
created  value  as  has  land. 
4.     It  is  unjust  to  take  the  increment  of  land  in  taxes 
and    not    reimburse    the    landowner    when    there 
is  a  decrement  in  the  value  of  his  land. 

B.  It  is  difficult  of  assessment,  for 

I.     It  is  often  impossible  to  determine  land  values  ex- 
clusive of  improvements,  for 
a.     The  value  of  irrigated,  cultivated  or  fertilized 
land    cannot    be    correctly    estimated    apart 
from  the  improvements. 

C.  It  is  inelastic,  for 

1.  It  cannot  be  increased,  for 

a.     The  purpose  of  the  Single  Tax  is  to  take  all 
of  the  rent  of  land. 

2.  The  selling  value  and  rental  value  of  land  fluctuate 

and  will  cause  fluctuations  in  the  amounts  raised 
by  the  tax.  ,    *% 

D.  It  is  inadequate,  for 

I.     In  many  poor  communities  the  rent  of  land  is  in- 
sufficinet  to  meet  the  expenses  of  government. 

E.  It  will  lead  to  extravagance,  for 

1.  In   many   communities    there    are    enormous    land 

values  and  large  funds  will  pour  into  the  public 
treasury, 

2.  The    interest    of    citizens    in    having    government 

economically  administered  will  be  lessened,   for 
a.     A  majority  will  pay  no  taxes. 

F.  Its  adoption  will  necessitate  the  abolition  of   revenue 

taxes,  such  as  the  taxes  on  opium,  liquors,  tobacco, 
adulterated  foods,  etc.,  and  of  protective  taxes,  such 
as  the  tariff. 


XX  BRIEF 

III.     As  a  scheme  for  social  and  economic  reform  the  Single  Tax 
on  land  values  is  undesirable,  for 

A.  It  will  result  in  the  confiscation  of  private  property  in 

land,   for 

1.  The  appropriation  by  society  of  the  rent  and  in- 

crease in  value  of  land  will  abolish  the  selling 

value  of  land  and  constitute  the  state  the  uni- 
versal landlord. 

2.  Vacant  property  will  revert  to  the  count}-  for  de- 

linquent taxes. 

B.  Confiscation  of  private  property  in  land  is  not  desirable, 

for 

1.  By   a   process    of    evolution    society    has     evolved 

from  a  state  of  common  or  community  owner- 
ship of  land  to  a  state  of  private  ownership  of 
land. 

2.  Private  ownership  of  land  is  the  basis  of  our  civili- 

zation. 

C.  It  will  result  in  discouraging  the  policy  of  conservation, 

for 

1.  A  premium  wall  be  placed    on    exploiting    natural    ' 

resources. 

2,  Timber  lands  especially  will  suffer,  for 

a.     The   timber    will  have    to    be   cut   to  pay  the 
taxes,   for 

(i)     The    land    yields     no     income    until    the 
timber  is  cut. 


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George. 

Real  Estate  Magazine.  4:  No.  3.  Mr.  '14.  Merchants  and  the 
Single  Tax;  a  Brief  of  the  Merchants'  Association  of  New 
York  on  the  Herrick-Schaap  Bill  Halving  the  Tax  Upon  Im- 
provements. 

♦Survey.  31 :697-702.  Mr.  7,  '17.  Halving  the  Tax  Rate  on 
Buildings;  the  Argument  in  Opposition.     E.  R.  A.  Seligman. 

♦Survey.  32:332-4.  Je.  24,  '16.  Shall  New  York  Untax  Build- 
ings?   C.  C.  Williamson. 


SELECTED  ARTICLES  ON 
SINGLE    TAX 


INTRODUCTION 

Taxation  problems  are,  at  best,  rather  intricate  for  the 
majority  of  citizens.  The  consideration  of  these  problems  has  so 
long  been  left  to  the  discussion  of  the  doctors  and  the  schools 
that  the  scholars  have  come  to  look  upon  the  crude  reasoning 
of  the  common  mind  as  an  intrusion  upon  their  own  special  field. 
This  seems  to  be  the  present  attitude  of  economic  scholarship 
towards  the  popular  mind  as  expressed  in  Single  Tax  propaganda. 

Granting  that  the  popular  thought  on  taxation  has  too  often 
been  directed  to  evasion  of  taxes,  it  would  still  be  evidence  of 
unreasonable  skepticism  as  to  the  intrinsic  Tightness  of  human 
nature,  if  one  could  not  conclude  that  no  just  basis  for  the 
distribution  of  the  burden  of  taxation  has  yet  been  found,  and 
that  the  scholars  have  failed  to  adapt  their  erudition  to  the 
problems  of  the  "man  in  the  street." 

It  is  very  recently,  indeed,  that  political  economists  have 
thought  it  within  the  proprieties  to  devote  much  attention  to 
Single  Tax  discussions.  This  explains  why  so  much  of  the 
available  printed  matter  on  Single  Tax  has  been  written  by  Single 
Tax  propagandists,  and  so  little  of  the  meager  literature  of 
opposition  by  the  economists. 
S'  Meantime,  the  question  of  the  adoption  of  the  Single  Tax 
theory  as  a  working  basis  of  taxation  has  compelled  jthe  attention 
of  the  average  citizen  in  his  capacity  of  voter^n  varfous  parts/ 
of  our  own  and  other  countries.  I 

The  present  status  of  the  taxation  problem,  therefore,  is 
distinctly  controversial.  In  considering  the  subject  it  is  but 
right  to  examine  carefully  the  literature  of  propaganda,  for  it  is 
that  hterature  that  is  in  the  hands  of  one's  neighbor  who  is 
about  to  vote  on  the  adoption  of  the  single  tax.    It  may  be  sadly 


SELECTED   ARTICLES 

biased  by  the  enthusiasm  of  the  advocate  or  the  antagonism  of 
the  objector— but  it  is  being  read.  Therefore  the  compiler  has 
thought  it  fair  to  reprint  some  of  this  literature. 

From  a  cursory,  but  comprehensive  view  of  the  subject,  I 
suggest  to  the  student  or  the  citizen  who  is  confronted  with  the 
necessity  of  coming  to  a  decision  concerning  the  adoption  of  a 
Single  Tax  program,  a  careful  outlining  of  present  forms  of 
taxation  and  their  underlying  principles.  Such  a  study  would 
develop  certain  axiomatic  statements  that  would  clarify  the 
thinking  of  most  of  us. 

It  would  be  established : — 

1.  That  some  form  of  taxation  is  as  necessary  as  it  is  unavoid- 
able everywhere  in  the  civilized  world,  except  on  Crusoe's  island. 
It  is  not  unusual  to  find  unthinking  citizens  who  regard  taxes  as 
an  especially  objectionable  form  of  human  oppression,  designed 
by  the  powerful,  and  collected  chiefly  from  those  least  able  to 
pay. 

2.  That  the  promotion  of  the  general  welfare  is,  or  should 
be,  the  sole  object  of  taxation.  At  the  vanishing  point  of  the 
general  welfare,  and  the  consequent  ascendancy  of  the  private 
welfare  of  favored  individuals,  therefore,  comes  the  test  of  the 
soundness  of  any  tax. 

3.  That  the  best  scheme  of  taxation  is  that  which  falls  upon 
the  individuals  composing  society  according  to  the  ability  of 
each  to  pay,  and  to  participate  in  the  benefits  of  community 
expenditures  for  governmental  purposes. 

It  is  by  such  criteria  as  these  that  the  general  property  tax, 
income  tax,  inheritance  tax,  poll  tax,  internal  revenue  and  all 
excise  taxes,  tariffs,  franchise  taxes,  occupational  taxes,  and  the 
proposed  Single  Tax  should  be  tested.  And  much  wisdom  is 
required  of  those  who  apply  the  tests  skillfully,  and  with  fidelity 
to  the  public  welfare. 

Edna  D.   Bullock. 
September,  1914. 


SELECTED  ARTICLES  ON 
SINGLE    TAX 

Outlook.     68:  171-6.     May    18,   1901. 

Rights   of  Man.     Lyman  Abbott. 

At  present  the  expenses  of  governments  are  chiefly  met  by 
three  forms  of  taxation :  a  tariff  tax  on  imports,  a  tax  on  incomes, 
and  a  tax  on  property,  real  and  personal. 

The  tariff  on  imports  is  an  unjust  tax  because  it  is  levied, 
not.  upon  property  nor  on  income,  but  upon  expenditure.  The 
rich  man  calls  on  government  for  much  greater  protection  than 
the  poor  man.  If  he  is  a  landlord,  he  has  a  hundred  houses  to 
be  protected;  the  poor  man  has  but  one.  If  he  is  stockholder 
in  a  great  railroad,  he  has  a  highway  thousands  of  miles  long 
to  be  protected,  v^^hile  the  poor  man  has  nothing  but  the  pathway 
from  his  front  door  to  his  gate.  The  rich  man  ought  therefore 
to  pay  a  very  much  larger  tax  than  the  poor  man.  It  ought  to 
be  proportioned  to  the  value  of  his  property,  because  the  value 
of  his  property  determines,  roughly  speaking,  the  amount  of 
protection  which  he  needs.  He  who  has  fifty  millions  of  dollars 
invested  in  mines,  railroads,  oil-wells,  ought  to  pay  nearly  ten 
thousand  times  as  much  taxes  as  the  householder  who  has  a  home 
in  the  village  or  a  farm  in  the  country  worth  five  thousand 
dollars.  But  if  the  tax  is  levied  upon  imports,  he  who  has  fifty 
million  dollars  to  protect  does  not  pay  ten  thousand  times  more 
taxes  than  he  who  has  five  thousand  dollars  in  a  homestead  to  be 
protected.  The  millionaire  wears  somewhat  more  expensive 
clothing,  lives  in  a  somewhat  more  expensive  house,  has  some- 
what more  expensive  furniture,  eats  somewhat  more  expensive 
food;  but  it  is  perfectly  evident  that  he  cannot,  if  he  tries, 
expend  on  himself  and  his  family  ten  thousand  times  as  much  as 
his  humbler  neighbor.  Taxes,  therefore,  levied  on  expenditure 
are  always  and  necessarily  unjust. 

The  second  tax  is  one  on  incomes.  The  income  can  generally 
be  ascertained  only  by  the  statement  of  the  man  who  has  the 
income;   an  income  tax,  therefore,   tempts   every  man  to  make 


4  SELECTED   ARTICLES 

false  statement  of  his  income,  in  order  to  reduce  his  tax,  A  tax 
system  which  involves  wholesale  temptation  is  not  a  system  to 
be  commended  if  any  better  one  can  be  found.  But  this  is  not 
all.  Men  who  live  upon  salaries  can  state  their  income  accu- 
rately; men  who  live  upon  profits  derived  from  business  cannot 
state  their  income  accurately.  It  often  happens  that  a  business 
man  cannot  tell  in  any  given  year  whether  he  has  made  any 
profit.  He  never  can  tell  accurately  how  much  profit  he  has 
made,  for  he  must  always  make  allowance  for  the  rise  in  value 
of  some  things  he  has  purchased  and  the  fall  in  value  of  others, 
and  this  estimate  of  stock  in  hand  is  rarely  more  than  a  shrewd 
guess.  An  income  tax,  therefore,  falls  proportionately  more 
heavily  on  the  man  whose  income  is  in  salaries  or  wages  than 
on  the  man  whose  income  is  in  profits.  That  is,  it  falls  more 
heavily  on  the  dependent,  if  not  on  the  poorer,  classes.  But  that 
is  not  all.  Income,  again,  may  be  derived  from  industry,  or  it 
may  be  derived  from  investment.  The  investment  is  property 
which  the  government  must  protect,  and  the  protection  of  this 
property  requires  governmental  expenditure,  while  the  protection 
of  the  individual  requires  but  Httle  governmental  expenditure, 
and  practically  no  more  for  the  man  who  is  earning  a  hundred 
dollars  a  day  than  for  the  man  who  is  earning  one  dollar  a  day. 
An  income  tax,  therefore,  is,  in  the  third  place,  inequable 
because  it  is  not  proportioned  to  the  expenditure  demanded  of 
the  government  by  the  persons  taxed.  A  tax  on  income  derived 
from  industry  is  a  tax  on  industry  itself,  which  should  be  the 
last  to  be  taxed. 

The  third  source  of  government  revenue  is  a  tax  upon 
property,  real  and  personal.  If  the  value  of  all  property,  real 
and  personal,  could  be  justly  estimated,  and  the  tax  could  be 
levied  on  the  property  thus  estimated  in  the  proportion  of  its 
actual  value,  the  result  would  be  a  just  and  reasonable  tax;  but 
in  effect  this  is  impossible.  For  government  is  dependent  upon 
the  citizen's  own  statement  for  its  knowledge  of  the  citizen's 
personal  property.  It  is  largely  dependent  on  his  statement 
for  its  estimate  of  the  value  of  that  property.  The  citizen  is 
thus  brought  under  temptation  both  to  conceal  the  possession 
of  personal  property  and  underestimate  its  value,  and  in  point 
of  fact  this  temptation  is  so  considerable  that  personal  property 
largely  escapes  taxation.    This  escape  of  personal  property  from 


SINGLE   TAX  5 

taxation  is  so  common,  and  the  frauds  and  falsehoods  into 
which  men  are  led  by  the  desire  to  secure  the  same  exemption 
which  their  neighbors  secure  is  so  great,  that  the  abolition  of 
all  tax  on  personal  property,  has  been  very  earnestly  urged  by 
both  moral  reformers  and  financial  reformers  in  the  interest 
both  of  simplicity  and  of  justice.  Yet  it  seems  difficult,  if  not 
impossible,  to  defend  on  abstract  principles  a  system  of  taxation 
which  levies  all  the  expenses  of  government  on  real  estate,  for 
no  other  reason  than  that  real  estate  cannot  be  hidden  away 
from  the  assessor's  inspection.  Why  should  the  man  who  has 
put  his  industry  into  a  house  pay  a  tax,  while  the  man  who  put 
his  industry  into  horses,  carriages,  dresses,  or  bank  stock — 
that  is,  money  loaned  to  others— not  pay  a  tax?  The  one  derives 
benefit  from  the  government  no  less  than  the  other.  Justice 
would  seem  to  require  that  he  should  pay  as  well  as  the  other. 

The  so-called  Single  Tax  proposes  to  rid  government  of  all 
these  perplexities  by  assuming  as  true  what  in  the  previous 
article  I  have  tried  to  show  is  true,  that  land  and  its  contents 
are  not  proper  subjects  of  private  ownership ;  that  the  land  which 
in  the  Hebrew  commonwealth  belonged  to  God,  and  in  the 
feudal  system  belonged  to  the  king,  in  a  republic  belongs  to  all 
the  people.  It  proposes  to  make  them  the  landlord,  and  it 
asserts  that  if  as  landlord  they  receive  a  rental  which  fairly 
represents  the  value  of  the  land  and  its  contents,  no  one  will 
need  to  pay  any  taxes;  that  if,  in  other  words,  the  people  come 
by  their  own,  they  have  income  enough  for  all  the  expenses  of 
government,  and  probably  some  to  spare. 

Thus  properly  speaking,  the  Single  Tax  is  not  a  tax  at  all. 
It  is  an  exemption  from  all  taxation  by  means  of  a  resumption 
of  the  commonwealth  by  its  owners,  the  common  people.  What 
would  be  called  a  tax  would  really  be  a  rental,  and  this  rental 
would  be  based,  not  on  the  idea  that  the  man  who  pays  it  pays 
for  the  protection  which  government  affords  his  property;  it 
would  be  based  on  the  idea  that  the  man  who  pays  it  pays  to  the 
owner  of  the  land  a  rental  for  the  land  of  which  he  is  the 
tenant.  This  rental  would  be  paid,  or  this  tax  would  be  levied, 
not  on  real  estate,  but  on  land  and  its  contents.  All  that  human 
industry  had  done  to  improve  the  land  would  belong  to  the 
o^vner— he  would  pay  no  tax  on  it;  all  the  value  inherent  in  the 
land  as   God  has  made  it,   or  added  to  the  land  by  what  the 


6  SELECTED   ARTICLES 

public  has  done  for  it,  would  belong  to  the  public,  and  this 
value  the  public  would  receive,  in  rental,  or  taxation. 

Thus,  let  the  reader  imagine  two  plots  of  ground,  each  one 
hundred  acres  in  extent,  side  by  side  in  a  rural  district  where 
wild  land  sells  for  five  dollars  an  acre.  One  of  them  is  wild. 
No  tree  is  felled,  no  plow  has  ever  turned  the  virgin  soil,  no 
fence  has  been  erected.  Everything  is  as  nature  made  it.  The 
other  is  a  cultivated  farm,  with  house,  barns,  outhouses,  orchard, 
cultivated  meadow-land.  The  uncultivated  land  is  worth  in  the 
market  five  hundred  dollars ;  the  cultivated  farm  would  be 
worth  five  thousand  dollars.  But  for  purposes  of  taxation  each 
would  be  estimated  as  worth  five  hundred  dollars,  and  on  that 
five  hundred  dollars  the  tax  or  rent  would  be  estimated,  and  for 
the  simple  reason  that  the  man  who  had  built  the  house  and  the 
barn  and  the  outhouses,  and  planted  the  orchard,  and  constructed 
the  fences,  would  not  pay  any  tax  on  this  wealth,  which  is 
the  product  of  his  industry.  Of  this  the  people  are  not  the 
owners ;  he  is  the  owner.  Or,  again,  let  the  reader  imagine  two 
lots  side  by  side  in  the  center  of  a  great  city,  where  a  lot  one 
hundred  feet  by  fifty  is  worth  a  thousand  dollars.  One  stands 
vacant;  on  the  other  a  ten-thousand-dollar  building  has  been 
erected.  On  each  lot  the  same  tax  would  be  paid,  or,  to  speak 
more  accurately,  for  each  lot  the  same  rent  would  be  collected, 
because  the  owner  of  the  building  would  pay  no  rent  for  that 
building,  which  is  the  product  of  his  industry;  he  would  pay  rent 
only  for  the  land,  which  is  not  the  product  of  his  industry,  the 
value  of  which  has  been  created  partly  by  the  God  who  made 
it,  partly  by  the  entire  community  who  live  in  its  vicinity,  and 
who,  therefore,  should  receive  the  benefit  of  the  value  which 
their  presence  and  activity  have  conferred  upon  it. 

In  a  similar  manner  the  owner  of  a  mine — whether  coal,  gold, 
copper,  or  iron — would  pay  in  rent  the  value  of  the  mine  as 
fairly  estimated  before  ever  a  pick  had  been  put  into  the  hillside. 
All  the  product  of  the  industry  which  had  opened  up  the  mine 
and  made  its  treasure  available  would  belong  to  him.  All  the 
value  of  the  mine  as  raw  material,  and  all  the  increased  value 
of  that  mine  due  to  the  opening  of  railroads,  the  increase  of 
population,  the  development  of  civilization,  would  belong  to 
the  State,  not  to  the  owner,  because  it  would  be  the  gift  of  God 
enhanced  by  the  product  of  the  general  activity  of  the  commu- 


SINGLE   TAX  7 

nity.  The  value  thus  added  by  the  general  social  conditions 
which  surround  land  is  the  "unearned  increment"  of  which  the 
reader  so  often  hears  in  the  discussion  of  this  subject. 

But,  as  we  have  seen,  it  is  not  only  land  and  its  contents 
that  belong  to  the  public.  Forces  of  nature  belong  to  the  public 
also.  The  right  of  the  public  to  these  forces  is  now  recognized 
by  our  patent  laws,  which  give  to  the  patentee  a  right  to  his 
special  use  of  them  only  for  a  limited  term.  It  is  quite  con- 
ceivable that  these  patent  laws  should  be  so  modified  as  to 
enable  government,  and  perhaps  any  individual,  to  take  advan- 
tage of  the  patented  device  on  paying,  not  whatever  the  patentee 
may  choose  to  ask  for  his  device,  but  what  a  disinterested  tri- 
bunal may  think  that  it  is  worth.  Not  only  the  forces  of  nature, 
but  the  great  franchises  created  by  the  state,  belong  to  the  state. 
The  exclusive  right  to  run  a  car-track  through  the  street  of  a 
great  city,  the  exclusive  right  of  a  railroad  corporation  to  run 
a  railroad  from  New  York  to  Buffalo,  belongs  primarily  to  the 
people,  in  the  one  case  of  the  city,  in  the  other  case  of  the  state. 
That  it  belongs  to  them  is  evident  from  the  fact  that  the  track 
cannot  be  laid  down  in  the  street  of  the  city,  nor  the  railroad 
built  from  New  York  to  Buffalo,  without  special  authority  from 
the  people.  The  work  which  the  car  company  or  the  railroad 
corporation  does  is  to  be  paid  for.  The  fruit  of  their  industry 
belongs  to  them.  But  the  highway  of  which  they  make  use  in 
their  industry  belongs  to  the  people  of  the  city  or  the  state,  and 
the  so-called  tax  paid  by  the  railroad  corporation  should  be  so 
adjusted  that  the  industry  of  muscle  and  of  brain  which  has 
produced  and  carried  on  the  railroad  shall  receive  its  just 
compensation,  which  should  be  paid  to  those  who  have  con- 
structed and  are  managing  the  railroad;  and  the  rental  of  the 
highway,  whether  in  the  municipality  or  across  the  state,  should 
be  paid  to  the  people  to  whom  that  highway  really  belongs. 

This  rental  may  be  charged  either  in  the  form  of  a  tax  or  in 
the  form  of  a  rental.  Hitherto  franchises,  that  is,  the  exclusive 
right  to  use  a  public  highway,  have  been  given  to  private  owners, 
personal  or  corporate.  Sometimes,  as  in  the  case  of  the  Pacific 
Railroad,  not  only  the  highway  has  been  given,  but  a  bonus  has 
been  added  in  order  to  induce  the  private  owner  to  take  the 
highway  as  a  gift.  This  was  always  folly.  The  folly  has  been 
now  so  demonstrated  that  to  continue  to  give  away  these  high- 


8  SELECTED   ARTICLES 

ways  is  scarcely  less  than  criminal.  A  single  case  will  serve 
to  illustrate  the  value  to  a  city  which  takes  possession  of  its 
highway  and  rents  it  instead  of  giving  it  to  a  corporation. 

The  Boston  subway  has  been  let  to  the  corporation  which 
operates  the  trolley-cars  of  that  city  for  4  7-8  per  cent  annually 
on  the  cost.  This  4  7-8  per  cent  meets  all  interest  on  municipal 
bonds,  and  leaves  a  surplus  sufficient  to  repay  the  entire  principal 
invested  in  less  than  forty  years.  The  corporation  which  has 
hired  the  subway  has  leased  its  lines  to  another  corporation 
which  guarantees  seven  per  cent  on  its  common  stock  and  eight 
per  cent  on  its  preferred  stock.  That  is,  in  the  city  of  Boston, 
the  corporation  which  operates  the  trolley-car  system  makes  a 
profit  such  as  enables  it  to  give  satisfactory  dividends  to  its 
stockholders  and  pay  the  whole  cost  of  the  subway,  principal  and 
interest,  in  less  than  forty  years.  The  city  of  New  York, 
learning  a  lesson  from  this  and  other  analogous  experiments, 
has  now  in  a  similar  manner  undertaken  to  build  its  own  sub- 
way. It  will  build  this  on  money  borrowed  upon  its  bonds.'  It 
has  already  leased  this  subway  to  a  corporation  on  such  terms 
that  at  the  end  of  the  fifty  years  the  bonds,  principal  and 
interest,  will  have  been  paid.  In  other  words,  the  subway  will 
belong  to  the  municipality,  though  it  will  not  have  expended  a 
dollar  of  the  people's  taxes  in  its  construction.  It  is  clear  that 
the  same  principle  might  be  applied  to  surface  roads  in  town 
and  country,  long  or  short,  operated  by  steam  or  operated  by 
electricity.  Whether  this  rent  shall  be  paid  for  the  highway  by 
the  railroad  corporation  in  the  form  of  a  rent  or  in  the  form  of 
a  tax  is  immaterial.  The  essential  fact  to  be  noted  is  that,  if  the 
people  keep  possession  of  the  highways  which  belong  to  them,  the 
rentals  therefrom  would  go  far  toward  paying  the  expenses  of 
the  government. 

It  does  not  come  within  the  province  of  this  article  to  go 
into  detailed  argument  with  figures  in  support  of  any  particular 
scheme.  My  object  is  to  give  the  general  reader  as  clear  and 
coherent  an  account  as  I  can,  in  a  limited  space,  of  the  method 
which  modern  thinkers  have  wrought  out,  by  which  the  common 
people  can  secure  joint  benefit  of  the  common  wealth,  without 
revolution.  He  who  desires  to  study  the  philosophy  of  this 
plan  more  fully  will  find  material  for  his  study  in  Henry 
George's  "Progress  and  Poverty."     He  who  desires  to  estimate 


SINGLE   TAX  9 

scientifically  its  economic  effect  will  find  material  for  his  study 
in  Thomas  G.  Shearman's  "Natural  Taxation."  He  will  in  the 
latter  book  find  reasons  given  for  the  belief  that  a  fair  rental  to 
the  people  as  landlord  for  the  value  of  wild  land  and  its  con- 
tents, and  of  public  franchises  created  by  and  belonging  to  the 
people,  would  be  adequate  to  pay  all  the  expenses  of  government, 
municipal,  state,  and  federal.  He  will  also  find  there  given  the 
reasons  for  believing  that  such  a  rental,  instead  of  increasing  the 
burdens  of  the  agricultural  class,  would  decrease  them;  and, 
finally,  the  reasons  for  believing  that  such  a  rental  could  be 
collected  with  almost  absolute  equity,  since  there  would  be  no 
possibility  of  concealing  the  land  or  the  franchise  for  which 
the  rent  would  be  paid,  and  not  much  difficulty  in  estimating 
their  natural  market  value.  This  last,  the  moral  argument  for 
the  Single  Tax,  will,  to  him  who  regards  ethical  considerations 
as  more  important  than  economic,  appear  of  the  first  importance. 
It  is  thus  stated  in  a  recent  letter  by  Mr.  Charles  Francis  Adams : 

On  this  moral  side,  which  to  my  mind  is  the  most  important  side  of 
all,  there  can,  so  far  as  I  see,  be  but  one  way  of  looking  at  the  thing. 
The  Single  Tax  would  be  an  enormous  improvement  over  the  existing 
system,  or  over  any  other  system  wliich  I  think  could  be  devised.  It  would 
reduce  taxation  to  a  basis  of  absolute  certainty  and  fairness,  rendering 
evasion  impossible.  A  complete  stop  would  thus  be  put  to  the  whole  system 
of  cheating,  and  consequent  unjust  transfer  of  a  burden  from  those  who 
have  no  conscience  to  those  who  have  a  conscience — from  those  who  can 
escape  the  law  to  those  who  cannot  escape  the  law — which  is  the  unanswer- 
able argument  against  the  continuance  of  the  present  system — a  system 
which  puts  a  confessed,  because  quite  undeniable,  premium  on  perjury;  and 
no  system  which  puts  a  premium  on  perjury  admits  of  justification.  This 
argument  alone,  to  my  mind,  would  be  conclusive  in  favor  of  the  Single 
Tax.  Any  possible  amount  of  wrong  or  injury  it  might  incidentally  inflict 
would  to  my  mind  be  little  more  than  dust  in  the  balance  compared  with 
the  advantage  which  would  result,  after  the  thing  fairly  adjusted  itself, 
from  the  complete  freedom  it  would  bring  about  from  all  temptation  to 
evasion  and  false  swearing.  From  the  moral  point  of  view,  consequently, 
there  do  not  seem  to  be  any  two  sides  to  the  question;  and  the  moral 
point  of  view  is,  in  my  judgment,  the  all-important  point  of  view. 

The  question  may  be  and  has  been  asked,  Would  not  the 
carrying  out  of  this  plan  amount  to  a  confiscation  of  landed 
values  ?  Henry  George  concedes  that  it  would,  and  defends  such 
confiscation  on  the  ground  that  land  is  not  a  proper  subject  of 
ownership.  He  compares  the  loss  to  the  landowner  involved  in 
the   Single   Tax   with   the   loss   to   the  slaveholder  involved    in 


10  SELECTED   ARTICLES 

emancipation.  The  cases  do  not  seem  to  me  parallel.  Society 
has  no  right  to  organize  a  system  involving  ownership  of  man; 
society  has  a  right  to  organize  a  system  involving  ownership  in 
land.  If  the  community  thinks  the  private  ownership  and 
control  of  land  is  best  for  the  community,  it  has  a  right  to  pro- 
vide for  such  private  ownership  and  control ;  but  it  has  no  right 
to  provide  for  the  private  ownership  and  control  of  one  man  by 
another,  against  the  protest  of  that  other,  though  he  be  but  a 
minority  of  one.  Society  having  provided  for  the  private  owner- 
ship and  control  of  land,  and  individuals  having  invested  their 
earnings  in  that  land  on  the  faith  of  that  provision  of  society, 
society  has  no  right  by  revolutionary  act  to  confiscate  the 
property  and  destroy  for  the  individual  ow^ner  the  economic 
values  which  it  has  itself  created.  If,  therefore,  it  were  proposed 
suddenly  to  abolish  all  taxes  on  imports,  on  incomes,  on  personal 
and  real  property,  and  levy  them  all  on  land  and  its  contents 
and  on  franchises,  the  proposition  would  involve  an  industrial 
revolution  which  would  be  at  once  inexpedient  and  unjust.  But 
no  such  sudden  change  is  possible.  If  taxation  is  taken  off  from 
all  other  objects,  and  levied  only  on  those  things  which 
are  properly  a  common  wealth,  the  change  can  be  wrought  out 
gradually,  and  there  will  be  time  for  industry  to  adjust  itself 
to  the  new  conditions  as  they  are  created.  There  is  very  little 
reason  to  believe  that  the  practical  injustice  to  individuals  which 
would  grow  out  of  the  adoption  of  the  Single  Tax  theory,  in  any 
way  which  would  be  possible  in  America,  would  be  so  great  as 
the  injury  which  has  come  to  individuals  through  the  use  of 
steam  and  electricity,  through  the  influence  of  machinery^ 
through  the  organization  of  labor  and  of  capital,  and  through  the 
consequent  necessary  changes  in  industrial  conditions  and  in 
values  depending  on  those  conditions. 


Kansas  City  Star.     April  7,  1912. 
Tax  Reform.     F.  W.  Blackmar. 

(The   following  article   was   prepared   at   the  request  of    The  Star.) 
My  notions  of  tax  reforms  are  briefly  as  follows:   First,  that 
there    is    no    automatic    method    of    taxation    which    would    be 
satisfactory  to  everybody,  nor  no  tax   svstem  that  would  be  a 


SINGLE   TAX  ii 

panacea  for  the  ills  of  humanity.  However,  it  is  possible  to 
make  the  system  more  just  and  equitable  by  changing  our 
methods  and  improving  the  social  conscience. 

The  present  system  is  inadequate  to  meet  the  demands  of 
our  expanded  industries.  It  violates  the  fundamental  principle, 
that  the  basis  of  taxation  should  be  the  capacity  of  the  indi- 
vidual to  pay.  It  is  unjust  and  inequitable  because  it  permits 
double  taxation  and  the  shifting  of  taxes  upon  people  who  are 
least  able  to  bear  them.  The  general  property  tax  under  which 
we  are  working  has  been  practically  abandoned  by  every  other 
civilized  nation  except  the  United  States,  and  our  present 
changes  are  working  to  that  end. 

Income  Tax  the  Most  Just 

The  capacity  of  the  individual  to  pay  is  measured  by  his 
income,  in  fact,  all  taxes  must  be  paid  out  of  incomes  if 
property  is  to  be  kept  intact.  An  income  tax,  therefore,  is  the 
most  just  of  all  taxes.  It  is  said  to  be  the  most  difficult  tax  to 
collect,  but  if  made  a  fundamental  part  of  the  system  instead 
of  an  extra  extortion,  it  would  be  found  no  more  difficult  to 
assess  and  collect  than  any  other  tax.  The  chief  objectors  to 
the  income  tax  in  the  United  States  are  men  of  large  incomes 
who  fear  it  will  be  too  just  for  them.  The  ideal  tax  system,  and 
the  one  toward  which  we  seem  to  be  working,  is  about  as  follows : 

First — Abolish  the  general  property  tax  by  taking  the  tax  off 
improvements  and  personal  property. 

Second— Fnt  the  tax  on  land  values.  Put  the  tax  on  economic 
rent  or  the  earning  capacity  of  land  which  is  measured  by  its 
market  value  without  improvements.  In  assessment,  separate 
town  lots  from  agricultural  land.  Estimate  the  tax  of  the 
former  on  site  value  and  the  latter  on  fertility,  as  these  are  the 
two  most  important  elements  that  make  the  market  value  in 
each  case.  Tax  the  unimproved  land  the  same  as  improved. 
Tax  the  incomes  of  the  land  shown  by  6  per  cent  on  its 
capitalized  value. 

Third— Divide  all  other  incomes  into  categories  such  as 
salaries,  public  and  private;  manufacturers,  mines  and  forests, 
agencies,  banks  and  trust  companies,  trading  and  merchandising, 
corporations,  public  and  private;  rental  of  commercial  buildings, 
incomes  from  securities  such  as  notes,  bonds,  etc.     Make  sub- 


12  SELECTED   ARTICLES 

divisions  of  these  so  that  they  can  be  thoroughly  classified.  Let 
the  reports  of  each  individual  to  the  assessor  represent  the 
specific  income  from  each  category. 

Justice  Instead  of  Robbery 

By  improving  the  machinery  of  assessment  the  difficulties  of 
collection  would  be  reduced  to  a  minimum.  If  such  a  tax  should 
be  generalized  comparatively  few  people  would  object  to  it, 
as  they  do  the  personal  property  tax.  For  example,  if  a  man 
is  assessed  on  the  6  per  cent  $i,ooo  note  at  the  rate  of  3  per  cent 
the  state  will  take  half  of  his  income,  $30.  If,  however,  an 
income  tax  of  5  per  cent  is  put  on  the  $60  income  he  will  pay 
$3.00.  In  the  former  case  he  will  feel  it  a  process  of  robbery, 
in  the  latter  case  he  will  discover  it  is  a  matter  of  justice.  If  all 
the  incomes  were  assessed  this  way  there  would  be  a  sufficient 
revenue  to  meet  the  modern  demands  of  government. 

In  addition  to  the  tax  on  land  values  and  incomes,  there 
should  be  a  tax  on  franchises.  This  should  be  made  in  excess 
of  any  income  tax,  as  it  is  a  form  of  rent  obtained  for  special 
privileges.  Make  the  income  tax  on  property  progressive  and 
there  would  be  no  need  for  the  inheritance  tax;  indeed,  an 
inheritance  tax  is  a  mild  form  of  social  robbery.  It  is  not  a 
tax  at  all,  for,  while  the  property  which  has  already  met  the 
demands  of  taxation  imposed  by  the  government  is  passing  from 
the  hands  of  the  dead  to  the  living,  the  government  reaches  in 
and  seizes  a  part  of  it  by  exercising  its  piratical  powers. 

Poll  Tax  "Badge  of  Liberty'' 

Excessive  wealth  should  be  reached  by  a  graduated  progres- 
sive income  tax  rather  than  by  the  inheritance  tax.  Poll  taxes 
might  be  assessed  as  a  badge  of  liberty.  No  one  ought  to  vote 
unless  he  has  a  sense  of  financial  responsibility  in  the  government. 

Taxes  should  be  taken  off  all  business  except  wherein  it  may 
be  necessary,  for  police  purposes,  such  as  for  the  control  of  vice, 
crime  and  social  maladjustment. 

In  making  the  above  statement  I  realize  the  numerous  diffi- 
culties that  arise  before  this  system  can  be  made  practical  and 
just.  The  income  tax  should  be  a  state  tax,  and  not  a  federal 
tax,  and,  in  order  to  make  it  successful,  all  states,  or  a  large 


SINGLE   TAX  13 

majority  of  them  at  least,  would  be  obliged  to  adopt  the  same 
system. 

Income   Tax   the   Foundation 

The  main  trouble  with  the  income  tax  in  the  past  has  been 
that  the  tax  was  an  independent  and  superfluous  part  of  the 
system.  As  presented  above  it  is  the  foundation  of  the  whole 
system.  As  it  is  founded  on  justice,  if  persistently  followed  it 
could  be  made  practical,  just  and  equitable.  It  may  take  a  long 
time  to  bring  this  about,  but  there  will  be  no  satisfactory  tax 
reform  until  this  is  accomphshed. 

But  an  ideal  of  this  kind  does  not  preclude  many  practical 
things  that  may  be  done  at  present  such  as  the  separation  of 
the  county  and  state  assessments;  applying  the  revenue  from 
franchises  f.or  the  support  of  the  state  and  the  revenue  from  local 
taxes  for  local  support;  the  assessment  of  property  at  its  full 
value ;  the  assessment  of  land  separate  from  improvements ;  the 
exemption  of  household  furniture  up  to  a  certain  limit;  the 
development  of  a  social  consciousness  which  would  realize  that 
the  tax  is  a  social  investment  which  yields  a  large  return;  the 
development  of  a  social  conscience,  which  makes  people  glad  to 
pay,  and  finally  an  improved  method  of  assessment  conducted  by 
experienced  and  trained  assessors,  etc.,  etc. 

Commonwealth  Club  of  California.     Transactions. 
9:259-88.     May,   1914. 

Local  Option  in  Taxation. 

Assembly    Constitutional   Amendment    No.    7 

Article  XIII,  Section  8>^.  Any  county,  city  and  county,  city  or 
town,  may  exempt  from  taxation  for  local  purposes  in  whole  or  in  part, 
any  one  or  more  of  the  following  classes  of  property:  Improvements  in, 
on,  or  over  land;  shipping;  household  furniture;  live  stock;  merchandise; 
machinery;  tools, '  farming  implements;  vehicles;  other  personal  property 
except  franchises.  Any  ordinance  or  resolution  of  any  county,  city  and 
county;  city  or  town,  exempting  property  from  taxation,  as  in  this  section 
provided,  shall  be  subject  to  a  referendum  vote  as  by  law  provided  for 
ordinances  or  resolutions.  Taxes  levied  upon  property  not  exempt  from 
taxation  shall  be  uniform. 


14  SELECTED   ARTICLES 

Report  in  Favor  of  Amendment 
Mr.  Eggleston  :  Assembly  Constitutional  Amendment  No.  7, 
is  in  form  and  substance  an  enabling  act,  which  permits  any 
county,  city  and  county,  city  or  town  to  exempt  from  taxation 
for  local  purposes,  in  whole  or  in  part,  specified  classes  of  prop- 
erty. These  classes  include  all  property  now  subject  to  local 
taxation  except  land  franchises. 

The  reasons  for  the  adoption  of  the  amendment  may  be  sum- 
marized as  follows : 

1.  The  present  general  property  tax  system  results  in  great 
inequalities  of  taxation  between  individuals  owning  the  same  kind 
of  property. 

2.  These  inequalities  are  particularly  acute  in  areas  of  large 
population. 

3.  The  remedies  should  be  local,  and  dependent  on  the  extent 
of  the  abuses. 

4.  The  subject  is  in  an  experimental  stage  in  America,  and  it 
is  to  the  public  advantage  that  the  various  localities  be  permitted 
to  seek  for  a  solution  in  various  directions. 

5.  As  the  general  interests  will  be  served  by  the  largest  pos- 
sible production  in  the  local  units,  it  is  correct  policy  to  allow 
each  local  unit  to  make  such  exemptions  from  taxation  as  will 
suit  its  local  interests. 

6.  The  amendment  is  a  logical  extension  of  the  home  rule 
principle  already  applied  with  such  success  to  California  cities. 
It  permits,  but  does  not  compel,  the  purely  local  problem  of  rais- 
ing local  revenues  to  be  determined,  as  the  problem  of  expending 
them  is  determined,  by  the  community  affected.  It  gives  each 
community  power  that  it  may  use  or  refrain  from  using  as  its 
interests  may  determine. 

OBJECTIONS    MADE  TO  THE  AMENDMENT 

Objection  is  made  that  under  this  amendment  the  whole  bur- 
den of  direct  taxation  may  be  placed  upon  land  values.  Such 
would  be  the  result  if  a  community  should  make  all  the  exemp- 
tions permitted  by  the  amendment.  That  will  depend  on  the  de- 
sires of  the  people  affected.  Obviously,  no  exemption  will  be 
made  unless  the  people  think  it  will  benefit  them;  and  if.  on  trial, 
they  find  that  any  exemption  does  not  benefit  them,  they  will 
withdraw  the  exemption. 


SINGLE   TAX  15 

If  the  amendment  results  in  confining  direct  taxation  for  local 
purposes  to  land  values,  it  will  be  because  the  people  in  the  com- 
munity affected  regard  that  policy  as  beneficial  to  them.  The 
benefits  that  may  cause  a  community  to  limit  taxation  to  land 
values  are,  as  far  as  can  be  seen,  the  following : 

1.  Simplicity  and  economy.  A  single  subject  of  taxation  is 
substituted  for  a  large  number  of  subjects. 

2.  Certaint3^  An  assessment  that  departs  from  a  fair  value 
is  easily  detected.  Two  lots  of  merchandise,  jewels,  securities 
or  other  personal  property  of  equal  value  may  vary  1000  per 
cent  in  assessment,  and  no  one  but  the  owner  be  the  wiser ;  but 
any  considerable  variation  in  the  assessment  of  two  pieces  of 
land  of  equal  value  will  arouse  immediate  protest. 

3.  The  value  of  land  is,  more  than  any  other  form  of  prop- 
erty, the  creation  of  the  community  as  a  whole.  While  other 
forms  of  property  acquire  part  of  their  value  from  the  fact  that 
population  makes  them  useful,  they  are  the  product  of  labor  and 
capital.  Land  alone  acquires  value  from  the  mere  presence  of 
population,  vacant  lots  in  a  city  being  quite  as  valuable  as  those 
on  which  improvements  are  erected.  There  is,  therefore,  a  valid 
reason  for  imposing  upon  land-values  a  tax  that  is  less  fair  in  the 
case   of  other   forms  of  property. 

It  is  said  that  this  amendment  for  home  rule  in  taxation  is  a 
mere  subterfuge  to  secure  the  adoption  of  Single  Tax.  But  home 
rule  in  taxation  was  adopted  in  western  Canada  before  the  term 
''Single  Tax"  was  heard  of,  and  in  western  Canada,  New  Zealand 
and  Australia  even  the  opponents  of  Single  Tax  do  not  object  to 
home  rule  in  taxation. 

It  is  said  that  the  burden  of  proof  of  the  necessity  for  and 
justice  of  the  measure  falls  upon  the  advocates  of  the  amendment. 
We  accept  the  burden  and  justify  the  amendment  because  the 
general  property  tax  is  admitted  to  be  a  failure,  because  it  has 
been  abandoned  with  good  results  by  the  progressive  states  of 
western  Canada,  New  Zealand  and  AustraHa,  and  because  the 
predicted  injurious  results  of  home  rule  in  taxation  have  not 
obtained  in  any  country  where  it  has  been  tried. 

While  there  is  discussion  in  those  countries  as  to  the  methods 
of  taxation  adopted  under  home  rule,  there  is  no  discussion  as  to 
the  principle  of  home  rule.  It  is  not  necessary  for  us  to  disprove 
theoretically  the  objections  raised  by  the  opponents,  because  those 


i6  SELECTED   ARTICLES 

objections  have  been  disproved  by  the  practical  operation  of  home 
rule  in  taxation  in  Canada,  New  Zealand  and  Australia. 

The  objection  that,  with  home  rule  in  taxation,  rivalry  between 
communities  will  inevitably  bring  us  all  to  Single  Tax,  is  merely 
an  assertion  that  if  any  community  shall  exempt  all  property 
except  land  values,  it  will  be  so  benefited  by  the  change  that  other 
communities  will  adopt  the  same  system  in  order  to  get  the  same 
benefits.  But  the  experience  of  municipalities  in  western  Canada, 
New  Zealand  and  Australia  shows  that  the  objection  is  invalid. 

Our  opponents  shift  their  ground  when  they  say  that  "no 
advantage  to  a  community  can  be  derived  from  a  policy  of  exemp- 
tions per  sc."  If  that  be  true,  the  adoption  of  exemptions  by  one 
community  will  not  cause  other  communities  to  adopt  those  ex- 
emptions. Our  opponents  contradict  themselves  when  they  assert 
that  the  amendment  will  permit  a  policy  that  will  confiscate  the 
property  of  large  land  owners,  and  at  the  same  time  enrich  those 
large  land  owners;  that  it  will  put  an  additional  and  unjust  bur- 
den upon  them,  and  at  the  same  time  greatly  benefit  them  by 
giving  them  tax  exemptions  of  thousands  of  dollars  a  year ;  that 
it  will  enrich  them  by  favoritism  and  crush  them  with  grossly 
unjust  burden. 

The  objection  that  non-residents  will  be  injured  if  residents 
of  a  community  are  permitted  to  adopt  certain  exemptions,  is 
fully  answered  by  the  fact  that  Americans  and  Europeans  are 
investing  capital  in  western  Canadian  communities  that  exempt 
as  well  as  in  those  that  tax  improvements. 

The  objection  that  farmers  may  be  injured  by  the  operation  of 
the  amendment  is  fully  answered  by  the  experience  of  rural  mu- 
nicipalities in  western  Canada.  If  California  farmers  do  not 
wish  to  take  any  action  under  the  amendment,  they  will  be  free 
to  keep  the  present  system  of  taxation.  If  they  adopt  a  system 
of  exemptions,  and  find  that  it  is  not  beneficial,  they  will  be  free 
to  abandon  it.  ■ 

EXPERIENCE   OF   THE   IRRIGATION    DISTRICTS 

As  to  the  effect  of  total  exemption  of  personal  property  and 
improvements  in  farming  communities,  we  need  not  go  so  far 
from  home  as  New  Zealand,  Australia,  or  even  Canada.  The 
California  irrigation  law  permits  irrigation  districts  formed  prior 
to  1909  to  exempt  improvements  from  tax  for  irrigation  purposes. 


SINGLE   TAX  17 

and  does  not  permit  taxation  of  personal  property  for  irrigation 
purposes.  Thus  irrigation  districts  formed  prior  to  1909  have 
home  rule  in  taxation. 

Using  that  power,  the  districts  of  Modesto,  Oakdale  and  South 
San  Joaquin  have  exempted  improvements  from  tax. 

While  the  California  irrigation  law.  gives  the  home  rule  tax 
power,  as  stated  above,  that  law  is  less  elastic  and  narrower  than 
the  home  rule  tax  amendment.  The  law  gives  irrigation  districts 
no  option  of  taxing  personal  property  either  "in  whole  or  in  part," 
nor  does  it  give  the  option  of  partial  exemption  of  improvements, 
as  does  the  home  rule  tax  amendment. 

California  has  separation  of  state  and  local  taxation,  and  that 
system  will  be  improved.  No  county,  city  or  town  has  any 
pecuniary  or  other  interest  in  the  public  revenues  raised  locally  by 
any  other  community,  and  has  no  interest  in  the  method  of  raising 
such  revenues.  Therefore,  no  one  outside  of  the  county,  city  or 
town  has  any  right  to  say  how  such  a  taxing  unit  shall  raise  its 
local  revenue. 

The  home  rule  tax  amendment  is  necessary  for  the  rounding 
out  of  our  system  of  local  self-government.  As  has  been  proved 
where  home  rule  in  taxation  'exists,  it  is  beneficial  and  satis- 
factory; while  our  general  property  tax  system  is  admittedly  in- 
jurious and  unsatisfactory. 

EFFECTS   IN   OTHER   LANDS 

As  has  been  proved,  also,  in  those  countries  where  home  rule 
in  taxation  is  in  effect,  capital  for  investment  continues  to  flow 
in,  instead  of  flowing  out.  From  political  and  industrial  stand- 
points, then,  home  rule  in  taxation  has  been  fully  justified  as 
beneficial  to  communities  as  well  as  to  individuals.  It  is  justified 
in  theory  as  well  as  in  practice  by  the  provincial  and  municipal 
officers  of  western  Canada. 

The  Minnesota  Tax  Commission  made  a  personal  investiga- 
tion of  the  various  tax  systems  of  the  four  western  provinces  of 
Canada,  under  home  rule  in  taxation,  in  1912,  and  reported  that 
"local  option  in  taxation"  is  working  well  and  satisfactorily. 

Personal  investigation  by  a  member  of  this  committee  of  tax 
systems  and  tax  methods  in  western  Canada  confirms  the  state- 
ments of  the  Minnesota  Commission  as  to  the  satisfactory  work- 
ing of  home  rule  in  taxation  in  western  Canada.    For  example, 


4 


i8  SELECTED   ARTICLES 

of  the  6i  urban  and  rural  municipalities  of  British  Columbia,  32 
have  taken  no  action  under  the  home  rule  tax  law,  26  have 
adopted  the  policy  of  total  exemptions,  and  3  have  adopted 
partial  exemptions. 

Except  for  the  fact  that  personal  property  is  not  taxed  in 
western  Canada,  and  that  municipalities  are  not  permitted  to 
assess  improvements  more  than  50  per  cent  of  their  value  in 
British  Columbia,  or  more  than  60  per  cent  in  other  provinces, 
for  taxation,  the  California  home  rule  amendment  is  almost  iden- 
tical with  the  local  option  tax  laws  of  those  provinces. 

Home  rule  in  taxation  has  been  in  effect  in  New  Zealand  for 
about  twenty  years,  and  in  Australia  for  about  fifteen  years. 
There  is  no  taxation  of  personal  property,  but  counties,  cities  and 
towns,  and  boroughs,  school  districts,  road  districts  and  im- 
provement districts  may  exempt  improvements  by  vote  of  land 
owners.  Improvements  are  taxed  on  a  50  per  cent  valuation  un- 
less entirely  exempt.  The  latest  available  report  from  New  Zea- 
land, 1910,  shows  that  some  160  taxing  districts  have  voted  on 
the  question  of  total  exemption,  and  that  exemption  has  been 
adopted  in  about  125  districts — by  vote  of  land  owners  only. 
The  meager  reports  from  Australia  show  that  exemption  has 
been  adopted  in  about  two-thirds  of  the  communities  in  which 
votes  have  been  taken.  South  Australia  adopted  a  local  option 
or  home  rule  tax  law  in  December,  1913,  and  two  elections  were 
held  under  the  law  the  same  month.  Total  exemption  carried 
in  one,  and  failed  in  the  other. 

NO    UNIFORMITY    IN    THE    PRESENT    SYSTEM 

The  objection  made  against  permitting  any  variation  from 
uniformity  of  assessment  in  different  communities  lacks  force. 

While  our  present  system  is  called  "uniform,"  it  is  not  uni- 
form. In  various  counties  and  municipalities,  personal  property 
is  assessed  all  the  way  from  20  to  75  per  cent  of  its  value,  and 
improvements  from  40  to  ys  per  cent. 

Assessments  made  in  cities  and  towns  by  county  and  mu- 
nicipal assessors  show  astonishing  variations.  For  example,  in 
Sacramento  City  in  1912,  the  city  assessor's  valuation  of  real 
estate  exceeded  that  of  the  county  assessor  by  $6,909,130,  and  his 
valuation  of  improvements  exceeded  that  of  the  county  assessor 
by  $2,031,840;  while  the  county  assessor  found  $134,330  more  of 


SINGLE   TAX  19 

personal  property  than  the  city  assessor.  Each  assessor  operates 
under  a  personal  home  rule  tax  law  enacted  and  enforced  by 
himself.  Counties  and  municipalities  should  have  legal  power 
to  do  what  assessors  now  do  illegally  and  openly,  by  public 
consent. 

Under  the  home  rule  amendment,  as  under  the  present  law, 
the  taxpayer  who  owns  property  in  a  dozen  counties  or  cities 
must  have  a  separate  tax  bill  from  each  taxing  unit.  No  greater 
confusion  could  be  created  by  exempting  in  one  county  or  city  the 
kinds  of  property  taxed  in  another.  The  money  is  raised  from 
local  property,  and  is  spent  for  the  benefit  of  the  local  community. 
Every  element  of  public  interest  is  satisfied  if  in  one  community 
each  owner  of  the  same  kind  of  property  pays  an  equal  tax  for 
an  equal  value,  or  if  all  owners  of  certain  kinds  of  property  are 
exempt  in  whole  or  in  part  under  the  law. 

For  these  reasons  we  believe  the  amendment  should  be  adopted. 

Appendices  to  Report  of  W.  G.  Eggleston 

WESTERN    CANADIAN    MUNICIPALITIES.      DATES   OF  ADOPTION    OF  COM- 
PLETE   OR    PARTIAL    EXEMPTION    OF   IMPROVEMENTS 

Partial 
Municipality.  Exemption.  Complete  Exemption. 

Edmonton 1903    when  incorporated 

Salmon  Arm 50%  until  1909       1909 

Chiliwack  Township .      1S90   when  incorporated 

Matsqui 1893   when   incorporated 

Peachland 1899   when   incorporated 

New  A\^estminster. . ..     50%  until  1911        1911 

Burnaby 1896   when   incorporated 

Point  Grey 1908   when   incorporated 

City  of  Chiliwack 1   mill  for   fire   protection  since  incorporation 

19?? 

Victoria 507^  until  1911        ....   1911  by  popular  vote 

Surrey 1879   when   incorporated 

Merritt 1902   when   incorporated 

Coquitlam • 1909   when   incorporated 

Sumas 2  mills  for  schools  since  incorporation  1883 

Kelowna 1909   when   incorporated 

Penticton Since      incorporation,      about 

1908 

Nanaimo 1878 

Oak  Bay 1888   when   incorporated 

Vancouver I  ctO.5 — 7.5  9r  ....    1 910 

Medicine  Hat 407o  until  1909       1909 

Winnipeg -'0% 

rieg-ina 67% 

Saskatoon 75% 

Moose  Jaw 75  % 

Calgary 70% 

Kamloops 70% 

Summerland Since,  incorporation 


20  SELECTED   ARTICLES 


Partial 
Municipality.  Exemption.  Complete  Exemption. 

Kent Since*  incorporation 

Langley Since      incorporation,      about 

1880 

Mission  (rural) Since  incorporation 

North  Vancouver Since      incorporation,      about 

1900 

Prince  Rupert Since      Incorporation,      about 

1907 

Saanich    507o  until  1912       1912 

South  A^ancouver Since  incorporation 

Spallumcheen Since  incorporation 

Also,  in  1912  about  200  small  municipalities  and  improvement  districts 
in  Saskatchewan  and  Alberta  had  adopted  total  exemption  in  the  preceding 
seven  or  eight  years.  Not  one  has  ever  abandoned  total  exemption  after 
having  adopted  it. 

COMPARISONS  IN  PER  CAPITA  BUILDING  EXPENDITURES 

Opponents  of  the  home  rule  tax  amendment  are  preaching  funeral 
sermons  over  the  cities  of  Western  Canada,  especially  Vancouver,  because 
their  building  permit  figures  for  19 13  fell  below  those  of  19 12.  Totals 
of  building  permits  are  often  misleading.  The  proper  basis  of  comparison 
is  the  per  capita  of  building  expenditures. 

We  have  no  official  census  figures  of  California  cities  since  19 10. 
Therefore  to  give  all  the  advantage  of  doubt  to  the  opponents  of  the  home 
rule  tax  amendment,  the  following  per  capita  figures  of  building  operations 
in  Canadian  cities  are  based  on  the  population  and  building  of  19 13,  while 
those  for  the  California  cities  are  based  on  19 10  population  and  19 13  build- 
ing operations.  Obviously,  that  will  make  a  better  showing  for  the  Cali- 
fornia cities. 

California  Cities.  Western  Canadian  cities. 

Population   1910.  Population   1913. 

Building,       Per  Building,       Per 

1913.       capita.  1913.       capita. 

Bakersfield $    760,7:4         $65       New  Westm'ster,$    958,975        $79 

Berkeley 2,236,700  55      Victoria 4,037,992  73 

Fresno 1.776,666  71      Vancouver 10,423,197  91 

Pasadena 2,787,507  92      Edmonton 9,242,450         130 

Sacramento 3,416,057  76      Medicine  Hat 3,857,572         241 

Oakland 9,106,191  66 

San  Francisco,   total $32,797,259         $78  per  capita 

San   Francisco,    private 21,037,264  55  per  capita 

Edmonton's  total  as  above  is  all  "private  construction.'' 
Vancouver    is    especially    mentioned    as    "dead."     That    city    abolished 
taxes   on    improvements   in  January,    19 10. 

Vancouver  building  in  1910-11-12-13 $60,376,000 

Oakland,  Fresno,  Sacramento,  Pasadena  and  Stock- 
ton,   same   years 55,286,878 

Population  of  those  Cahfornia  cities,   1910,   was     273,000 
Population  of  Vancouver,  1913 114,000 

This  population  of  Vancouver  does  not  include  population  of  what  is 
called  "Greater  Vancouver,"    which  is  not  a  municipality. 


SINGLE   TAX  21 

The  Vice-President:  ]\Ir.  H.  E.  Monroe  will  now  give  you 
the  reasons  why  local  option  in  the  matter  is  not  advisable. 

Report  Against  the  Amendment 

Mr.  Monroe:  Constitutional  Amendment  No.  7,  is  the  so- 
called  "Home  Rule  in  Taxation"  bill.  Briefly,  this  is  merely  an 
enabling  act,  giving  to  cities,  cities  and  counties,  and  counties 
the  power,  through  their  governing  bodies,  to  exempt  from  tax- 
ation, for  local  purposes,  certain  classes  of  property.  The  ex- 
emptions must  be  made  either  in  whole  or  in  part  according  to 
certain  classifications  and  all  property  may  be  exempted  except 
land  and  franchises. 

The  power  to  make  this  exemption,  as  stated,  is  vested  in  the 
various  governing  bodies,  subject  only  to  the  right  to  a  referen- 
dum vote.  That  is,  a  temporary  majority  in  a  board  of  super- 
visors, or  city  council,  which  might  easily  be  the  result  of  mere 
chance,  the  matter  of  exemptions  not  being  an  issue  at  the  elec- 
tion of  members,  and  consequently  the  personal  views  of  candi- 
dates not  being  known  or  inquired  into,  might  fasten  a  system  of 
exemptions  upon  a  community  and  drive  those  upon  whom  the 
additional  burdens  of  taxation  would  be  cast,  to  fight  the  ordi- 
nances by  a  referendum.  It  would  seem,  if  such  a  system  is  ad- 
visable at  all,  that  such  a  momentous  change  should  not  be  pos- 
sible without  first  obtaining  an  affirmative  vote  of  the  electorate 
affected.  The  burden  of  proof  should  be  cast  upon  those  who 
propose  the  exemptions  and  not  upon  those  who  must  pay  the 
additional  burdens. 

A  single  tax  proposal 

This  proposed  amendment  receives  its  chief  support  from  the 
Single  Taxers,  or  Henry  Georgeites,  because  they  believe,  and 
justly  as  we  shall  show  later,  that  its  adoption  would  bring  a 
little  nearer  the  day  of  their  fondly  Imagined  Elysium,  when  all 
taxes  shall  be  levied  on  land  values  and  the  entire  economical 
rent  be  absorbed  by  the  state.  To  oppose  a  measure  because  of 
Its  friends  may  not  be  scientific  but  it  is  human.  At  least  it 
should  arouse  our  suspicions  and  command  our  closest  scrutiny, 
and  I  would  say  to  you,  if  the  spectre  of  Socialism  ever  troubles 
your  waking  hours,  or  haunts  your  dreams,  do  not  summon  this 
genie  believing  that  It  will  be  your  humble  servant  and  aid  you 


22  SELECTED    ARTICLES 

in  the  collection  of  your  revenues,  but  which  to  your  sorrow 
you  will  not  thereafter  be  able  to  exercise.  Beware  of  the 
Greeks  bearing  gifts.  The  breach  in  the  wall  is  not  easily  re- 
paired. Socialism  we  know  is  but  a  relative  term,  but  the  social- 
ism which  takes  from  those  who  have  merely  because  they  have, 
spells  the  failure  of  our  civilization  and  ends  a  cycle  of  the 
world's  history. 

But  this  amendment,  although  frankly  thus  supported,  is  now 
defended  on  other  grounds.  Let  us  consider  briefly  some  of  the 
arguments  advanced : 

First,  which  to  us  seems  a  dodging  of  the  issue,  it  is  contended 
that  we  have  only  to  consider  now  whether  counties  and  cities  are 
to  be  allowed  to  govern  themselves,  not  what  they  might  do  with 
the  power  if  granted  to  them ;  and  many  supporters  will  be  found 
because  tlie  fight  is  being  made  not  for  the  "Single  Tax"  but  for 
"home  rule  in  taxation." 

PRINCIPLES    OF    LOCAL   REGULATION 

It  seems  obvious  enough  that  we  have  not  solved  our  problem 
merely  by  stating  that  each  locality  should  be  allowed  to  regulate 
its  own  affairs.  We  must  first  determine  whether  this  is  a  proper 
subject  for  local  regulation,  for  evidently  all  matters  of  govern- 
ment are  not  of  this  character.  The  tests  which  determine 
whether  a  matter  may  properly  be  left  to  local  regulation,  or 
should  be  governed  by  general  laws,  would  seem  to  be  these: 

I.  A  matter  should  not  be  left  to  local  regulation  which  af- 
fects, or  may  affect,  any  considerable  number  of  people  outside 
of  the  locality.  2.  Only  those  matters  should  be  left  to  local 
regulation  which  can  be  so  regulated  by  one  community  without 
a  compelling  force  upon  the  action  of  other  communities  similarly 
situated.  Over  and  above  all  this,  every  citizen  in  the  state  owes 
a  duty  to  every  other  citizen  in  that  state,  and  cannot  absolve  his 
own  conscience  in  voting  for  a  measure  which  may  be  turned 
into  an  instrument  of  oppression  against  an  unfortunate  minority 
in  some  communities,  merely  because  his  own  particular  com- 
munity may  not  be  affected.  In  other  words,  if  this  proposed 
amendment  could  be  used  as  an  instrument  of  injustice  in  any 
community,  as  citizens  of  the  state,  we  owe  a  duty  to  the  minority 
of  that  community  to  protect  them  from  an  irresponsible  ma- 
jority.   It  is  an  easy  philosophy  of  the  day  that  the  people  should 


SINGLE   TAX  23 

rule,  but  he  who  fails  to  recognize  that  a  popular  majority  maybe 
the  worst  of  tyrants  reads  neither  history  nor  human  nature  aright. 
Applying  these  principles,  it  seems  to  us  that  this  amendment 
can  not  be  defended  merely  on  the  ground  that  it  is  a  question  of 
local  regulation.  The  question  of  taxation  does  affect  large 
numbers  of  people  outside  of  the  borders  of  any  city  or  county 
and  no  locality  can  adopt  locally  a  system  of  exemptions  without 
exercising  a  compelling  force  upon  other  communities.  San 
Francisco,  for  instance,  has  from  fifty  to  a  hundred  thousand 
people  who  have  their  legal  residence  in  another  county,  yet  daily 
do  business  within  our  borders,  own  property  here,  and  many  pay 
taxes  here.  They  are  vitally  affected  by  our  fiscal  regulations 
but  would  have  no  voice  in  determining  them. 

EFFECT    OF    EXEMPTIONS 

The  compelling  force  which  would  be  exerted  on  other  com- 
munities is  most  apparent.  An  exemption  of  personal  property 
in  San  Francisco  would  tend  to  attract  people  here  from  trans- 
bay  communities  and  so  willy  nilly,  they  would  be  compelled  to 
follow  suit.  Oakland  would  want  to  exempt  factories  and  San 
Francisco  and  Richmond  would  in  self  protection  be  obliged  to 
grant  a  similar  exemption.  Fresno,  perhaps,  would  exempt  farm 
implements  and  Pierced,  Stanislaus  and  San  Joaquin  would  have 
to  follow  her  lead ;  and  so  it  would  go  until  all  of  our  exemptions 
were  exhausted  and  we  would  be  down  to  a  Single  Tax  basis.  Nor 
would  this  argue  anything  in  favor  of  the  measure.  A  system 
of  exemptions  by  a  single  community  might  prove  profitable  to 
that  community  as  a  whole,  but  any  such  temporary  advantage 
would  soon  be  nullified  by  the  actions  of  other  communities  and 
the  net  result  of  the  competitive  bidding  would  simply  be  that  all 
of  our  exemptions  would  be  exhausted  and  we  would  be  on  a 
Single  Tax  basis. 

In  passing,  we  may  note,  that  another  force  would  drag  us 
toward  the  Single  Tax  goal.  Guns  are  made  to  shoot  with  and 
the  right  to  exempt  is  given  to  be  used.  Adopt  this  amendment  and 
at  once  a  movement  will  be  started  to  exempt  certain  classes  of 
property.  One  exemption  obtained  is  used  as  the  argument  for 
the  next.  Exemptions  are  popular  with  those  exempted  and  as 
the  numbers  of  the  tax  payers  constantly  decrease  by  successive 
exemptions  their  power  of  resistance  would  correspondingly  di- 


24  SELECTED   ARTICLES 

minish,  and  before  no  great  time  we  would  find  ourselves  squarely 
upon  a  Single  Tax  basis.  These  two  forces  would  operate  in  this 
manner,  under  local  regulation,  whereas  an  entire  state,  owing 
to  the  greater  uniformity  of  its  electorate,  could  not  be  induced 
to  adopt  this  system. 

ADDING   TO   THE   BURDEN    OF   THE    HONEST 

As  a  revenue  measure  the  adoption  of  this  amendment  is  urged 
because  of  the  inequalities  of  the  present  system,  which  to  us 
seems  an  astonishing  bit  of  reasoning.  Let  us  premise,  prelimin- 
arily, that  exemptions  are  bought  at  the  cost  of  extra  burdens  on 
others.  This  argument,  then  amounts  to  this;  personal  property 
quite  largely  escapes  taxation,  which  places  an  extra  burden 
on  the  honest  owner  of  personal  property,  or  on  the  owner  of 
personal  property  which  cannot  escape  the  assessor.  Now  in 
order  to  do  justice  to  this  class  of  honest  or  unfortunate  owners 
of  personal  property,  it  is  proposed  to  do  what?  Not  to  seri- 
ously tackle  the  problem  of  making  the  dishonest  pay,  but  to  ex- 
empt him  altogether — to  exempt  the  honest  and  the  unfortunate 
and  to  place  all  of  this  additional  burden  on  the  owner  of  real 
estate,  whose  burdens,  as  well  as  those  of  the  honest  owner  of 
personal  property,  have  already  been  augmented  by  the  derelic- 
tion of  the  rascals  who  won't  pay.  Isn't  this  a  rather  crude  speci- 
men of  justice?  It  reminds  one  of  Mark  Twain's  wilHngness  to 
sacrifice  all  of  his  wife's  relatives  on  the  altar  of  his  country. 

Our  opponents  attempt  to  answer  this  by  advancing  as  one  of 
their  arguments  in  favor  of  the  Single  Tax  what  they  are  pleased 
to  say  is  "the  certainty  with  which  a  tax  on  land  is  diffused  so 
that  the  burden  is  distributed  fairly  throughout  the  community," 
but,  this  is  exactly  what  does  not  happen.  Taxes  on  land  stay 
where  they  are  put.  Taxes  on  improvements,  at  least  of  urban 
property,  are  largely  shifted  but  those  on  land  values  are  not. 
It  is  impossible  to  follow  here  the  argument  to  show  this.  We 
can  only  refer  you  to  any  standard  writer  on  the  subject  for  these 
arguments.  Professor  Seligman  in  his  work  "The  Shifting  and 
Incidence  of  Taxation"  as  to  the  tax  on  agricultural  land  at  page 
275   says: 

"We  may,  therefore,  sum  up  the  discussion  by  stating  that 
under  actual  conditions  the  tax  on  agricultural  land  is  but  rarely 
shifted  to  the   consumer,   and   that,   where  tenant   farmers   are 


SINGLE   TAX  25 

found,  the  tax  is  borne  by  either  the  owner  or  the  tenant,  accord- 
ing to  the  changing  conditions  of  agricultural  prosperity.  Even, 
however,  where  the  tax  tends  to  be  borne  by  the  owner,  the  effect 
of  the  tax  may  be  injurious  to  the  tenant." 

As  to  urban  real-estate  at  page  286  he  says: 

"With  these  three  minor  exceptions  then  it  may  be  stated  that 
a  tax  on  the  site,  whether  it  be  levied  on  rental  value  or  on  capital 
value  is  borne  by  the  owner  of  the  land." 

If  these  conclusions  are  correct,  it  follows  then  that  a  Single 
Tax  on  land  values  would  transfer  the  entire  burden  of  govern- 
ment upon  the  shoulders  of  one  class,  the  land  owners.  Is  not 
the  mere  statement  of  any  such  monstrous  injustice  sufficient 
to  make  us  recoil  from  a  measure  which  would  make  such  a  re- 
sult possible— which  would  unquestionably  tend  toward  it,  and 
which  is  confessedly  proposed  with  that  end  in  view? 

It  is  not  our  purpose,  howevei",  to  discuss  the  Single  Tax  from 
the  Henry  George  standpoint.  We  have  no  fear  of  this  as  a  di- 
rect issue.  We  are  concerned  with  it,  only  so  far  as  this  proposed 
amendment,  if  adopted,  unwittingly  tends  toward  it.  This  amend- 
ment can  never  carry  as  a  Single  Tax  measure ;  if  carried,  it  must 
be  by  the  votes  of  those  who  mistake  it  as  a  revenue  measure ;  it 
must  be  by  the  votes  of  those  who  favor  Single  Tax,  not  as  an 
appropriation  of  economic  rent  but  as  a  desirable  method  of  rais- 
ing our  revenue,  or  by  those  who  believe  that  the  exemptions  of 
certain  classes  of  property,  or  the  levying  of  our  taxes  upon  land 
values  alone  will  in  some  mysterious  w^ay  add  to  our  prosperity. 
Let  us  analyze  these  claims. 

EFFECTS    OF    THE    SINGLE    TAX    IN    CANADA 

In  the  first  place  we  are  assured  that  this  plan  has  worked 
wonders  in  the  Northwest.  Vancouver  is  cited  as  an  illustration 
of  what  this  beneficent  system  will  do.  All  of  the  prosperity  of 
this  wonderful  city  was  due  to  the  Single  Tax,  but  let  us  see  how 
the  account  stands.  From  $13,150,365  in  1910,  the  building  per- 
mits bounded  up  to  $17,652,642  in  191 1,  and  $19,388,322  in  1912. 
This  was  attributed  to  the  magic  of  Single  Tax.  Vancouver  still 
has  its  Single  Tax,  yet  in  1913,  the  building  permits  fell  to 
$10,424,447,  nearly  one-half.  The  permits  for  December  1912 
were  $1,530,365  and  for  December  1913,  $175,245-  The  aggregate 
for  the  year  was  nearly  cut  In  two,  while  the  aggregate  for  the 


26  SELECTED   ARTICLES 

last  month  of  the  year  was  one-eighth  of  what  it  was  for  the 
same  period  of  the  preceding  year.  On  the  other  hand  in  \\'inni- 
peg,  where  this  system  is  not  in  force,  the  building  permits  for 
eleven  months  of  the  year  1913  amounted  to  $18,000,000  as  against 
$15,106,450  for  the  entire  year  1910.  For  these  figures  we  are  in- 
debted to  Mr.  F.  C.  Wade,  K.  C.  We  have  not  the  figures  at 
hand  for  other  cities  in  the  northwest  but  we  understand  that 
they  would  show  similar  results.  We  would  not  for  a  moment 
attribute  all  this  vast  shrinkage  of  the  evidences  of  prosperity 
in  Vancouver  to  its  fiscal  system — but  we  believe  that  we  have 
heard  tlic  last  for  some  time  of  the  wonderful  success  of  the 
Single  Tax  in  Vancouver.  So  much  for  laboratory  tests.  Let  us 
now  do  a  little  figuring  on  our   own  account. 

In  the  first  place,  we  want  to  observe  that  a  Single  Tax  on  land 
values,  benefits  the  rich  man  at  the  expense  of  the  poorer.  Mr. 
Wade  again  has  given  us  the  figures  for  Vancouver.  He  gives 
us  the  exemptions  on  different  classes  of  buildings  erected  from 
January  to  October  1913,  and  shows  that  out  of  the  total  ex- 
emptions for  that  period  of  $9,988,440  the  poor  man's  total 
exemption  would  be  $529,753.  That  is,  that  about  seventeen- 
eighteenths  of  the  exemption  w^as  in  favor  of  the  wealthier  class, 
and  one-eighteenth  in  favor  of  those  not  so  well  provided  for. 
We  will  give  you  some  startling  figures  for  our  city  later. 

EFFECTS   OF   SHIFTING   THE  BURDEN 

Our  second  proposition  is  that  the  Single  Tax  would  throw  an 
additional  burden  upon  the  agricultural  community.  The  per- 
centage of  value  of  land  to  that  of  improvements  outside  of  cities 
and  towns  is  greater  than  that  within  cities  and  towns,  conse- 
quently the  country  must  carry  a  larger  burden  if  the  land  alone 
is  taxed. 

While  we  do  not  any  longer  collect  state  taxes  directly,  and 
thus  this  is  no  longer  a  state  problem,  the  old  problem  still  exists 
in  all  of  the  interior  counties,  especially  in  those  which  contain 
any  considerable  towns  or  cities.  We  append  hereto  some  figures 
we  have  collected  from  a  few  counties.  These  show  that  in 
Fresno  county  the  farmers  now  pay  696/10  per  cent  of  the  tax; 
under  the  Single  Tax  would  pay  778/10  per  cent.  In  Stanislaus 
county  they  now  pay  81  per  cent;  would  pay  89  per  cent.  Even 
in  Madera  county,  where  there  are  no  considerable  towns,  the 


SINGLE   TAX  27 

farmers  now  pay  91  per  cent  of  the  county  tax  and  would  under 
the  Single  Tax  pay  95  per  cent. 

In  San  Joaquin  county  the  farmers  now  pay  596/10  per  cent 
of  the  county  tax  and  would  under  this  beneficent  system  have  to 
pay  71  7/10  per  cent.  All  of  these  figures  include  personal  prop- 
erty  taxes. 

These  figures,  staggering  as  they  are,  give  only  averages.  The 
individual  increases  of  burdens  cannot  be  arrived  at.  It  is  safe 
to  postulate,  however,  that  the  poorer  the  farm  the  larger  the 
percentage  of  land  value  to  improvements  and  personal  property, 
so  the  poorer  the  farm  the  larger  the  percentage  of  increased 
burden  by  this  system. 

CLASS   PREJUDICE   AND   DISCONTENT 

Our  third  proposition  is  that  the  Single  Tax  would  create  class 
prejudices  and  foster  discontent. 

The  burden  of  taxes,  as  we  have  shown,  would  fall  upon  one 
class,  but  the  amount  of  the  tax  would  depend  upon  the  votes  of 
those  who  bore  no  part  of  the  burden  and  who  would  clearly  out- 
number the  tax  payers,  a  condition  which  would  soon  engender 
the  bitterest  of  class  feeling.  The  farmers,  as  a  rule,  today,  feel 
that  they  receive  no  adequate  return  for  the  money  which  they 
pay  for  the  support  of  government.  The  man  of  property  be- 
lieves that  the  laboring  classes  are  uniting  with  the  "reformers" 
to  despoil  him,  while  the  laboring  man  believes  that  he  is  being 
deprived  of  what  rightfully  belongs  to  him.  Social  problems  are 
crowding  upon  us  thick  and  fast,  and  any  augmentation  of  this 
class  feeling  makes  the  problem  of  government  just  so  much  more 
difficult. 

The  fourth  proposition  is  that  the  Single  Tax  would  favor  the 
rich  man  at  the  expense  of  the  poorer.  We  have  already  seen 
from  the  figures  which  we  have  cited  from  Vancouver  how  the" 
exemption  of  improvements  works  to  the  interests  of  the  rich. 
The  same  would  be  true  as  to  the  large  manufacturer.  A  certain 
amount  of  ground  space  of  course  is  requisite  for  every  manu- 
facturing plant.  The  large  capitalists,  with  their  great  resources 
could  build  many  storied  factory  buildings  and  would  pay  no 
more  taxes  than  their  poorer  rivals,  who  were  compelled  to 
content  themselves  with  modest  one  or  two  story  buildings. 
Thus  this  aid  which  we  wish  to  give  to  manufacturing  enter- 


28  SELECTED   ARTICLES 

prises,  would  only  tend  to  drive  the  small  man  out  of  business 
and  to  hasten  the  division  of  society  into  two  classes,  the  rich 
employers  and  the  poor  employees. 

FURTHERING  CONGESTION  IN   CITIES 

Finally,  the  Single  Tax  would  aggravate  the  congestion  of  our 
cities.  This  would  happen  in  two  ways ;  because  a  city  could  not 
extend  its  boundaries  and  because  the  tendency  would  be  toward 
the  maximum  amount  of  improvements  in  the  area  actually 
improved. 

A  city  could  not  extend  its  boundaries  because  the  outlying 
sections,  being  long  in  land  and  short  in  improvements,  would 
never  agree  to  become  part  and  to  pay  the  burdens  of  a  city,  which 
was  long  in  improvements  and  short  on  land. 

That  the  tendency  would  be  toward  the  maximum  improve- 
ment and  consequent  congestion  would  seem  almost  self  evident. 
Such  has  been  the  admitted  tendency  in  Vancouver  and  a  little 
"reflection  will  show  us  that  it  must  be  true  everywhere.  The 
higher  priced  the  land,  and  consequently,  the  higher  the 
taxes,  the  greater  the  incentive  for  improvement.  And  the 
higher  the  building,  the  smaller  the  tax  will  be  on  the  invest- 
ment. Now  it  is  a  strange  sociological  fact  that  higher  rent  per 
floor  space  is  obtainable,  even  in  tenement  houses  occupied  by 
the  poorest  classes,  at  the  crowded  centers,  than  can  be  realized 
in  the  outskirts  of  the  city.  Conditions  being  equal  today  so 
far  as  taxes  are  considered,  the  outlying  regions  can  not  com- 
pete with  down  town  property.  A  ten  story  apartment  house  in 
the  Sunset  district,  with  the  ground  donated,  would  be  a  hope- 
less enterprise,  while  the  same  building  on  lower  Sutter  street, 
upon  an  expensive  lot,  would  net  its  owner  a  handsome  income. 
With  Single  Tax,  the  same  conditions  of  equality  would  exist, 
dnd  capital  w^ould  go  into  buildings  where  the  demand  existed. 

On  the  other  hand  there  would  be  no  cheapening  of  rents. 
Upon  our  assumption  that  all  personal  property  would  be  exempt 
from  taxation,  as  well  as  improvements,  there  would  be  no  ob- 
ject in  putting  capital  into  buildings  to  escape  taxation.  It  would 
only  be  so  invested,  when  it  could  realize  a  higher  profit  there  than 
elsewhere  and  that  would  be  determined  by  the  demand  as  at 
the  present  time.  If  there  were  any  tendency  otherwise  this 
would  tend  to  increase  the  cost  of  land  at  the  centers  where  as 


SINGLE   TAX  29 

we  have  seen  the  demand  is,  and  this  in  its  turn  would  tend 
to  check  further  building  and  thus  equilibrium  would  be 
established. 

NO    CHECK    ON    SPECULATION    IN    LAND 

But  it  is  urged  owners  would  build  in  order  to  realize  an  in- 
come from  their  property  rather  than  pay  the  increased  tax. 
This  would  not  be  true  for  very  simple  reasons. 

It  is  obvious  that  all  the  vacant  land  in  the  city  could  not 
be  improved  at  once.  No  matter  what  our  system  of  taxation, 
our  sand-dunes  and  hills  must  await  demand  and  capital  before 
they  will  be  improved.  An  additional  reason  why  this  would  not 
happen  is  that  the  additional  tax  is  at  once  capitalized,  the  loss 
at  once  falls  on  the  holder  and  thereafter  the  land  can  be  held  for 
speculative  purposes  upon  the  same  terms  of  expectancy  of  profit 
as  before.  Let  us  illustrate :  Take  a  thousand  dollars  as  the  unit. 
According  to  our  system  this  would  be  taxed  at  say  $600  and  the 
taxes  at  present  rate,  $2.20  would  be  $13.20.  If  the  entire  tax 
were  raised  from  the  land  the  rate  to  raise  our  present  revenue 
would  have  to  be  $3.81.  The  taxes  on  the  lot  then  would  be 
$22.86  or  $9.66  more  than  at  present.  Now  to  yield  this  amount  a 
year  would  require  $161  and  that  much  would  at  once  be  shaved 
off  the  value  of  the  lot.  It  would  suffer  a  further  loss,  however, 
because  as  it  increased  in  value  the  taxes  would  increase,  so  your 
purchaser  would  make  a  further  reduction  in  the  price,  say  $250 
all  told.  Now  the  tax  having  been  capitalized  at  $750  with  the 
additional  tax,  the  lot  is  as  good  a  speculation  as  it  was  at  the  old 
rate  at  $1000.  And  of  course  it  would  be  immaterial  whether  the 
lot  were  sold  or  the  old  owner  continued  his  speculation  on  the 
new  basis.  This  capitalization  of  the  tax  is  another  force  which 
would  operate  to  prevent  cheaper  rents.  Most  buildings  are 
erected  in  whole  or  in  part  on  borrowed  capital  and  the  banks  will 
not  lend  more  than  the  value  of  the  lot.  The  thousand  dollar  unit 
which  we  have  assumed  allows  for  a  thousand  dollars  worth 
of  building  but  when  this  unit  is  cut  to  $750  our  building  suffers  a 
similar  cut,  so  that  a  25  per  cent  smaller  building  is  erected,  thus 
to  that  extent  cutting  down  the  supply. 

LOCAL  EFFECTS   OF   EXEMPTION 

As  a  practical  illustration  of  how  these  laws  would  work  out, 
we  have  collected  some  figures  from  our  own  tax  roll    [Table 


30  SELECTED    ARTICLES 

Tabic  I,  SJiozuing  How  Single  Tax  JVould  Affect  San  Francisco 
Property.  Compiled  from  1913  Tax  Roll,  as  Appendix  to 
Report  of  H.  E.  Monroe. 

Value  Gained 

Value         of  Tax  or  lost 

of  im-  Pres-         under  by 

Description  of  real       prove-  ent  Single  Single 

property.  estate,    ments.         tax.  Tax.  ""J^ax. 

Crocker   Building $.506,f;30  $610,000  $24,566.00  $19,302.00  *$5,264.00 

Chronicle  Building.  ...  495,000  800,000  17,490.00  18,859.00  tl,369.00 
Examiner   Building....  413,230     390,000     17,671.00     15,743.00     *l,92S.OO 

Mills    Building 372,550     850,000     26,896.00     14,194,00*12,702.00 

Balance  Montgomery 
St.,  frontage  same 
block. 

A.   B.   McCreery 92,500       17,000       2,409.00       3,519.25     11,110.25 

M.    A.   DeBaveaga..      38,270         8,000       1,017.94       1.458.09         y440.15 
Virginia    Vanderbilt     66,940  0       1,472.68       2,550.41     11,077.73 

Keystone   Apartments.     19,060     135,000       3,389.32  726.19     *2,663.13 

Adjoining  properties. 

Joseph   Magnin 4,800  0  105.60  182.88  t77.28 

John  H.   C.   Prien..        4,000         6,500  231.00  152.40  *7S.60 

Lafayette   Apartments.     10,780       24,000  765.16  410.72        *354.44 

(N.      C.      Goodwin, 
Jr.) 
Adjacent    and     con- 
tiguous properties. 

T.  A.  Williams 25,500         9,000  759.00  971.55        t2l2.55 

Thos.  C.  Van  Ness.       4,500         2,800  160.60  171.45  tlO.85 

J.    G.    Woods 22,880         6,400  644.16  871.73        t227.57 

Eliz.  M.  Hudson 5,390         1,700  155.98  205.36  t49.38 

Block  bounded  by  Jack- 
son. Scott,  Pierce  and. 

Pacific 210,600     101,300       6,861.00       8,024.00     tl,163.00 

Block  bounded  by  Mis- 
sion,   A^alencia,     21st 

and     22d 286,290     145,380       9,497.00     10,908.00     tl,411.00 

Block  bounded  by  Cal- 
ifornia.  Clement,   7th 

and     8th 93,630       83,950       3,907.00       3,567.00        t340.00 

Block  bounded  by  Lin- 
coln Wav,  Irving, 
18th  and  19th  Aves..     52,970       20,390       1,614.00       2,018.00        T404.OO 

*  Denotes    gain.  t  Denotes  loss. 

The  local  tax  in  San  Francisco,  1913,  was  $2.20  on  the  $100  assessed 
value.  To  raise  the  same  revenue  by  a  Single  Tax  on  land  values  vk^ould 
require  a  tax  rate  of  $3.81.  Any  property  owner  may  therefore  reckon  his 
gain  or  loss  under  such  a  system  by  comparing  his  last  tax  bill  with  the 
bill  as  it  would  be  if  personal  property  and  improvements  had  been  ex- 
empted and  a  rate  of  $3.81  imposed  on  the  assessed  value  of  his  land. 

I,,  above]  \Vc  see  how  l)eautifully  the  rich  man  is  taken 
care  of  when  we  find  that  under  a  Single  Tax  the  owner  of  the 
Examiner  building  would  save  $2527  a  year ;  of  the  Crocker  build- 
ing $5250.  Mr.  Ogden  Mills  would  profit  on  the  Mills  building  to 
extent  of  $12,702.  Capitalized  at  6  per  cent  a  nice  little  present 
of  over  $200,000  would  be  made  to  him  by  "this  poor  man's  law." 


SINGLE   TAX 


31 


Table  U,  Showing  Increased  Burden  on  Country  Property  under 
Single  Tax  in  Illustrative  Counties.  Compiled  from  1913 
Tax  Roll. 


County. 
Stanislaus. . 

Madera 

Fresno 

San  Joaquin 


County. 
Stanislaus. . 

Madera 

Fresno 

San  Joaquin 


Value  of 

city 

real  estate. 

$2,014,945 

472,810 

,     12,871,950 

9,565,520 


Value  of 
city  im- 
prove- 
ments. 
$1,985,340 
352,785 
7,577,540 
8,713,415 


Value 

other 

city 

property. 

$1,046,770 

221,150 

3,272,989 

4,388,209 


A^alue  of 
country 

real 

estate. 

$16,356,760 

9,612,535 

45,201,890 

26,733,450 


Value  of 
country 
improve- 
ments. 
$3,172,935 
630,290 
8,120,865 
4,207,758 
Coun- 


Value  of 

all  other 

county 

property. 

.$2,680,760 
.  1,156,890 
.  1,026,858 
.  2,607,330 


Total 
value  city 
property._ 


Total 

value 

country 

property. 


Total  of 
country 
assess- 
ments. 


Coun-  try's 
try's  per- 
per-  cent- 
cent-  age 
age  of  under 
tax  Single 
now.      tax. 


S  5''047'045  $22Tld,455  $27,357;500  81    %    89     % 

^  ?'046:7l5  11  i99  715     12,446.460  91.7%    95  3% 

?^  7^2  479  54  349  613     78,072,092  69.6%    77.8% 

§2  667  150  33:548  535     56.215,685  59.7%  73.6% 


In  this  instance  some  of  the  people  who  would  make  this  present 
would  be  his  neighbors  in  the  same  block.  Mr.  McCreery,  the 
owner  of  the  Western  Union  building,  would  pay  an  additional 
$1  II0.25  a  year,  while  the  Title  Insurance  building  adjommg  it 
would  pay  $440.15  a  year  more  as  its  contribution  toward  the 
Mills  benefactions.  ^      j    •        -^ 

Out  in  the  residence  district  we  find  that  Nat  Goodwin  with 
his  Lafayette  apartments  would  have  $35444  additional,  while 
his  neighbors  in  their  modest  homes  would  pay  respectively 
$10.85,  $49.38,  $212.55  and  $227.50  more  per  year. 

Of  all  figures  collected  the  most  instructive  are  those  of  the 
Keystone  apartments  on  Hyde  and  Washington  streets.  This 
property  now  pays  $3389.32;  it  would  pay  $726.19,  a  nice  little  sav- 
ing of  $2,663.13.  ,  ,,    .... 

And  I  would  ask  you  single  taxers  is  that  the  type  of  buildings 
to  which  you  wish  to  condemn  us-that  and  the  crowded  tene- 
ment house?  Why  have  you  made  a  fetich  of  brick  and  stones? 
Must  the  vacant  spots  all  be  covered  with  them?  Does  the 
humble  home  no  longer  appeal  to  you?  Must  you  penahze  the 
man  who  would  beautify  our  city  by  planting  his  shrubs  and 
trees  and  flowers?  It  is  said  that  in  New  York  City  there  are 
children  who  have  never  seen  the  sun  rising  in  his  majesty,  nor 
looked   upon   it    setting    in   its    glory.      Brick    and   mortar-these 


32  SELECTED   ARTICLES 

are  their  prison  walls — and  shall  we  adopt  a  policy  which  hastens 
the  day  of  such  a  fate  for  our  little  ones?  And  shall  we  be- 
cause forsooth  dishonest  men  avoid  paying  their  just  share  of 
the  government's  burdens,  just  as  the  thief  steals  the  honest 
man's  purse — because  forsooth,  a  Single  Tax  would  be  easy  to 
collect — shall  we  enter  upon  a  policy  of  spoliation  and  con- 
fiscation? 

Action  by  tJic  Meeting 

The  Vice-President:  The  time  is  up  for  discussion  of  this 
particular  amendment,  and  I  will  now  call  for  a  vote.  All  in 
favor  of  what  is  known  as  the  home  rule  constitutional  amend- 
ment, will  signify  it  by  a  show  of  hands. 

32  voted  for  and  24  against  the  proposed  amendment.* 


World   Almanac. 
The  Single  Tax. 

The  following  statement  of  the  Single  Tax  principle  was  writ- 
ten by  Henry  George,  Sr. : 

We  assert  as  our  fundamental  principle  the  self-evident  truth 
enunciated  in  the  Declaration  of  American  Independence,  that 
all  men  are  created  equal  and  are  endowed  by  their  Creator  with 
certain  inalienable  rights.  We  hold  that  all  men  are  equally 
entitled  to  the  use  and  enjoyment  of  what  God  has  created  and 
of  what  is  gained  by  the  general  growth  and  improvement  of 
the  community  of  which  they  are  a  part.  Therefore,  no  one 
should  be  permitted  to  hold  natural  opportunities  without  a  fair 
return  to  all  for  any  special  privilege  thus  accorded  to  him,  and 
that  that  value  which  the  growth  and  improvement  of  the  com- 
munity attaches  to  land  should  be  taken  for  the  use  of  the  com- 
munity; that  each  is  entitled  to  all  that  his  labor  produces;  there- 
fore, no  tax  should  be  levied  on  the  products  of  labor. 

To  carry  out  these  principles,  we  are  in  favor  of  raising  all 
public  revenues  for  national,  state,  county,  and  municipal  pur- 
poses by  a  Single  Tax  upon  land  values,  irrespective  of  improve- 

*  There  were  89  members  and  guests  present.  Club  members  at  this 
date,    1,274. 


SINGLE   TAX  33 

merits,  and  all  the  obligations  of  all  forms  of  direct  and  indirect 
taxation. 

Since  in  all  our  states  we  now  levy  some  tax  on  the  value  of 
land,  the  Single  Tax  can  be  instituted  by  the  simple  and  easy  way 
of  abolishing,  one  after  another,  all  other  taxes  now  levied  and 
commensurately  increasing  the  tax  on  land  values  until  we  draw 
upon  that  one  source  for  all  expenses  of  government,  the  rev- 
enue being  divided  between  local  governments,  state  government, 
and  the  general  government,  as  the  revenue  from  direct  tax  is 
now  divided  between  the  local  and  state  governments,  or  by  a 
direct  assessment  being  made  by  the  general  government  upon  the 
states  and  paid  by  them  from  revenues  collected  in  this  manner. 
fThe  Single  Tax  we  propose  is  not  a  tax  on  land,  and  therefore 
[  would  not  fall  on  the  use  of  land  and  become  a  tax  on  labor. 
It  is  a  tax  not  on  land,  but  on  the  value  of  land.  Then  it 
would  not  fall  on  all  land,  but  only  on  valuable  land,  and  on  that 
not  in  proportion  to  the  use  made  of  it,  but  in  proportion  to  its 
value— the  premium  which  the  user  of  land  must  pay  to  the 
owner,  either  in  purchase  money  or  rent,  for  permission  to  use 
valuable  land.  It  would  thus  be  a  tax  not  on  the  use  and  improve- 
ment of  land,  but  on  the  ownership  of  land,  taking  what  would 
otherwise  go  to  the  owner  as  owner,  and  not  as  user. 

In  assessments  under  the  single  tax  all  values  created  by  in- 
dividual use  or  improvement  would  be  excluded,  and  the  only 
value  taken  into  consideration  would  be  the  value  attaching  to 
the  bare  land  by  reason  of  neighborhood,  etc.,  to  be  determined 
by  impartial  periodical  assessments.  Thus  the  farmer  would  have 
no  more  taxes  to  pay  than  the  speculator  who  held  a  similar 
piece  of  land  idle,  and  the  man  who,  on  a  city  lot,  erected  a 
valuable  building  would  be  taxed  no  more  than  the  man  who 
held  a  similar  lot  vacant.  The  Single  Tax,  in  short,  would  call 
upon  men  to  contribute  to  the  public  revenues  not  in  proportion 
to  what  they  produce  or  accumulate,  but  in  proportion  to  the 
value  of  the  natural  opportunities  they  hold.  It  would  compel 
them  to  pay  just  as  much  for  holding  land  idle  as  for  putting 
it  to  its  fullest  use.     The  Single  Tax,  therefore,  would— 

1st.  Take  the  weight  of  taxation  off  the  agricultural  dis- 
tricts, where  land  has  little  or  no  value  irrespective  of  improve- 
ments, and  put  it  on  towns  and  cities,  where  bare  land  rises 
to  a  value  of  millions  of  dollars  per  acre. 


34  SELECTED   ARTICLES 

2d.  Dispense  with  a  multiplicity  of  taxes  and  a  horde  of 
tax-gatherers,  simplify  government,  and  greatly  reduce  its  cost. 

3d.  Do  away  with  the  fraud,  corruption,  and  gross  inequality 
inseparable  from  our  present  methods  of  taxation,  which  allow 
the  rich  to  escape  while  they  grind  the  poor.  Land  cannot  be 
hid  or  carried  off,  and  its  value  can  be  ascertained  with  greater 
ease  and  certainty  than  any  other. 

4th.  Give  us  with  all  the  world  as  perfect  freedom  of  trade 
as  now  exists  between  the  states  of  the  Union,  thus  enabling 
our  people  to  share  through  free  exchanges  in  all  the  advantages 
which  nature  has  given  to  other  countries,  or  which  the  peculiar 
skill  of  other  peoples  has  enabled  them  to  attain.  It  would 
destroy  the  trusts,  monopolies,  and  corruptions  which  are  the 
outgrowths  of  the  tariff.  It  would  do  away  with  the  fines  and 
penalties  now  levied  on  any  one  who  improves  a  farm,  erects  a 
house,  builds  a  machine,  or  in  any  way  adds  to  the  general  stock 
of  wealth.  It  would  leave  every  one  free  to  apply  labor  or  ex- 
pend capital  in  production  or  exchange  without  fine  or  restric- 
tion, and  would  leave  to  each  the  full  product  of  his  exertion. 

5th.  It  would,  on  the  other  hand,  by  taking  for  public  use 
that  value  which  attaches  to  land  by  reason  of  the  growth  and 
improvement  of  the  community,  make  the  holding  of  land  un- 
profitable to  the  mere  owner  and  profitable  only  to  the  user.  It 
would  thus  make  it  impossible  for  speculators  and  monopolists 
to  hold  natural  opportunities  unused  or  only  half  used,  and  would 
throw  open  to  labor  the  illimitable  field  of  employment  which 
the  earth  offers  to  man.  It  would  thus  solve  the  labor  problem, 
do  away  with  involuntary  poverty,  raise  wages  in  all  occupa- 
tions to  the  full  earnings  of  labor,  make  overproduction  im- 
possible, until  all  human  wants  are  satisfied,  render  labor-saving 
inventions  a  blessing  to  all,  and  cause  such  an  enormous  produc- 
tion and  such  an  equitable  distribution  of  wealth  as  would  give 
to  all  comfort,  leisure,  and  participation  in  the  advantages  of  an 
advancing  civilization,  in  securing  to  each  individual  equal  right 
to  the  use  of  the  earth.  It  is  also  a  proper  fimction  of  society 
to  maintain  and  control  all  public  ways  for  the  transportation 
of  persons  and  property,  and  the  transmission  of  intelligence; 
and  also  to  maintain  and  control  all  public  ways  in  cities  for 
furnishing  water,  gas,  and  all  other  things  that  necessarily  re- 
quire the  use  of  such  common  ways. 


SINGLE   TAX  35 

Public.     14:392-3-     April  28,  1911. 

Single  Tax  in  New  South  Wales.    A.  G.  Huie. 

The  second  general  election  for  aldermen  under  the  local 
government  Act*  held  on  the  28th  of  January,  might  be  supposed 
to  have  been  affected  by  the  almost  universal  adoption  of  placing 
local  taxation  entirely  on  land  values.  In  fact,  however,  in  a 
vast  majority  of  places  this  question  was  not  an  issue  in  any 
sense.  It  is  generally  recognized  now  as  the  right  thing  to  raise 
local  revenue  from  the  unimproved  value  of  the  land  alone. 
Our  task,  then,  was  comparatively  easy.  We  had  only  to  pay 
attention  to  a  few  places  where  full  advantage  has  not  yet  been 
taken  of  the  law. 

At  Prospect  and  Sherwood  the  three  worst  opponents  of  this 
poHcy  were  defeated.  Also  at  Lane  Cove,  a  doubtful  place  which 
had  for  three  years  challenged  the  energies  of  our  local  friends 
to  back  up  friendly  aldermen  in  the  Council,  At  Woollahra  an 
alderman  who  recently  proposed  taxes  on  improvement  values, 
was  defeated,  and  a  land  value  taxer  elected  in  his  stead.  In 
various  other  places  old  opponents  were  rejected. 

The  place  that  has  given  us  most  trouble  is  North  Sydney. 
It  is  the  largest  municipality  outside  the  city,  in  the  state.  The 
aldermen  were  an  intensely  conservative  lot.  They  hated  the 
new  Act.  Like  all  conservatives,  they  believed  in  a  borrowing 
policy,  and  (outside  the  city)  had  the  largest  debt  in  the  state. 
Some  of  the  most  vicious  examples  of  land  monopoly  in  the 
metropolitan  area  are  in  North  Sydney,  and  the  aldermen  ap- 
peared to  think  that  it  was  their  bounden  duty  to  nurse  them. 
In  1908  they  decided  to  levy  entirely  on  unimproved  values  at 
3^d.  in  the  pound,  but  they  made  it  clear  that  they  were  against 
the  principle.  They  really  wished  to  impose  an  "additional 
general  rate"  on  improved  values,  but  feared  the  referendum  poll. 

Now  it  is  well  known  that  cunning  lawyers  may  find  a  loop- 
hole in  the  best  of  laws.  Our  Local  Government  Act  was  no 
exception  to  that  general  rule.  The  aldermen  found  that  under 
it  they  could  impose  a  "loan"  rate  for  the  payment  of  interest 
and  the  repayment  of  principal  without  a  referendum  vote.  So 
in  1909,  instead  of  again  imposing  the  3j^d.  rate  on  land  values, 
they  reduced  it  to  2>^d.  and  imposed  a  loan  rate  of  o.35d.  on 

*  See  The  Public,  volume  xiii,  page  1085. 


36  SELECTED   ARTICLES 

improved  values.  We  made  a  protest,  but  having  no  power  to 
demand  a  referendum,  were  helpless. 

In  1910  the  rates  were  put  at  2^4d.  for  land  values  and  0.33d. 
for  improvement  values.  I  tried  to  rouse  the  local  people  but 
failed.  It  is  a  hard  place  to  work.  But  as  the  time  for  election 
drew  on  I  issued  two  leaflets  and  held  a  number  of  open-air 
meetings.  The  efifect  was  good.  The  aldermen  against  us  were 
reduced  from  11  to  4,  to  8  to  7  in  our  favor.  But  a  majority 
of  one  was  too  narrow,  especially  as  one  or  two  men  on  our  side 
w^ere  rather  doubtful.  One  of  them  was  absent -when  the  ques- 
tion of  imposing  the  tax  came  on.  Then  one  of  the  other  side 
came  round  to  our  view,  saying  he  was  convinced  that  the  people 
wanted  rating  on  land  values  only ;  but  one  on  our  side  deserted, 
giving  a  bogus  reason  for  doing  so.  That  made  the  voting 
equal,  and  the  Mayor  gave  his  casting  vote  in  favor  of  taxing  im- 
provements. If  the  absent  man  returns  in  time  and  votes 
straight  it  may  be  possible  to  prevent  the  rate  being  confirmed, 
but  this  is  doubtful. 

Our  agitation  has  had  the  effect  here  of  reducing  the  rate  on 
improvement  values.  The  rates  for  191 1  are  3^d.  in  the  pound 
on  unimproved  values  and  ^d.  in  the  pound  on  improved  values. 

We  are  certain  to  win  in  the  long  run  even  in  North 
Sydney. 

The  municipalities  and  shires  of  New  South  Wales  that  raise 
local  revenues  from  the  taxation  of  land  values— all  that  I  am 
yet  able  to  give  figures  for,  and  it  is  not  a  picked  list — number 
46.  Their  rates  vary  from  half  a  penny  to  5^  pence  in  the 
pound  of  capital  value.  In  one  (Redfern),  the  rate  is  5^;  in 
two,  it  is  5 ;  in  four,  it  is  4^2  ',  in  five,  it  is  4 ;  in  sixteen,  it  is 
3;  in  ten,  it  is  2 ;  in  five,  it  is  I.  The  list  comprises  thickly  popu- 
lated suburban  districts,  country  towns,  and  sparsely  populated 
rural  districts,  which  we  call  "shires."  There  are  five  municipali- 
ties that  levy  local  taxes  on  "improved  values,"  meaning  the 
value  of  land  and  improvements  taken  together — "real  estate" 
taxation  as  I  understand  you  would  call  it  in  the  United  States. 

So  you  see  that  almost  all  local  taxation  in  New  South 
Wales  is  entirely  on  land  values,  except  the  "City"  portion  of 
the  metropolis.  And  this  was  one  of  the  main  factors  in  start- 
ing a  great  building  boom  over  three  years  ago,  of  which  there  is 
no  sign  of  slackening. 


SINGLE   TAX  37 

The  procedure  adopted  by  a  council  in  imposing  local  taxa- 
tion is  simple.  First  of  all  the  aldermen  consider  the  estimates 
for  the  year.  They  then  consider  how  the  money  is  to  be  raised. 
Thereupon  the  Town  Clerk  advertises  the  result,  which  must  be 
confirmed  within  a  month.  Notices  are  then  sent  to  landowners 
to  pay.  Following  is  an  exact  copy  of  one  of  these  advertise- 
ments, published  in  the  Daily  Telegraph,  February  14,  191 1 : 

MUNICIPALITY  OF  RANDWICK. 

Estimates  for  the  financial  year  ending  December  31st,   191 1,  under  Section 
142   of  the   Local    Government  Act    of    1906-7-8. 

Notice  is  hereby  given  that  at  a  duly  constituted  meeting  of  the  Council 
of  the  above  Municipality  held  on  Februray  7,  191 1,  the  following  estimates 
were  submitted  to  the  Council  in  pursuance  of  the  above  Act,  and  duly 
approved,  viz.: 

Amount   of  proposed   expenditure   out  of  the   General   Fund,  to 

be  carried £       28,548 

Amount  in  hand  available  for  such  expenditure 173 

Amount  of  other  revenue  likely  to  be  available 6,153 

Amount    required   to    be    raised   by    the    rate    for    such    expendi- 
ture   (net)    22,2.22 

The  total  unimproved  capital  value  of  the  Municipality  is 1,364,518 

It  is  proposed  to  raise  the  required  amount  by  making  and  levying  a 
general  rate  of  4d.  in  the  £  on  the  unimproved  capital  value  of  all  rateable 
land  within  the  Municipality. 

Ernest  H.  Strachan,  Town  Clerk. 
Town  Hall,  Randwick,  Feb.   13,  191 1. 

When  a  Council  wishes  to  levy  other  rates,  the  procedure  is 
similar,  but  it  has  also  to  set  out  clearly  that  a  poll  may  be 
demanded  except  in  the  case  of  a  "loan"'  rate,  as  in  North 
Sydney. 

I  have  endeavored  to  describe  what  is  being  done  in  New 
South  Wales,  so  that  the  reader  may  compare  it  readily  with 
what  is  'done  in  his  own  town  or  district.  He  cannot  go  wrong 
in  heartily  supporting  the  New  South  Wales  plan. 

We  are  determined  upon  taxing  unimproved  values  alone  in 
the  "City" — Sydney — and  to  get  the  amendments  in  the  local 
Government  Act  necessary  to  finally  settle  the  whole  question  of 
local  taxation  for  all  time. 

A  deputation  has  waited  upon  the  Minister  for  Public  Works, 
the  Hon.  Arthur  Griffith,  and  made  among  others  the  following 
requests  (the  term  "rates"  meaning  local  taxes),  to  which  Mr. 
Griffith  responded  sympathetically: 


38  SELECTED   ARTICLES 

Make  occupied  Crown  lands  in  the  city  rateable  in  the  same  way  as  in 
the  suburbs  and  country.  Present  occupied  Crown  lands  in  the  city  are 
rateable  on  the  rental  value,  but  not  on  the  unimproved  value. 

Make  rating  on  unimproved  values  compulsory,  or  allow  a  poll  in  all 
cases  on  the  same  lines  as  the  Local  Government  Act  provided  in  respect 
of  "additional  general,"  "special,"  and  "local"  rates.  At  present  a  loan 
rate  for  interest  and  sinking  fund  may  be  imposed  on  improved  values 
without  a  poll  being  allowed,  as  has  been  done  in  the  case  of  North 
Sydney. 

Land  occupied  for  railway  purposes  to  be  rateable. 

No  exemption  or  partial  exemption  in  the  case  of  land  used  for  private 
school  purposes. 

Effective  voting  for  city,  municipal,  and  shire  elections.  Probably  there 
is  not  one  local  council  in  the  state  that  is  truly  representative  of  the 
electors,  because  of  the  evil  effects  of  bunching,  throwing  votes  away,  etc., 
whereas  proportional  representation  would  enable  every  man  to  vote  in  a 
straightforward  way,  and  the  result  would  be  representative  in  the  fullest 
sense. 

A  public  valuation  of  lands  for  all  purposes — local,  state  and  federal, 
on  the  lines  of  the  New  Zealand  Act. 


Survey.     31:520,  538.     January  31.   1914. 

Present  Status  of  the  Single  Tax  Movement  Here  and  Abroad. 
Charles  H.  Ingersoll. 

That  the  Single  Tax  is  growing  apace  the  world  over  is  ob- 
vious even  to  casual  observers.  I  have  had  exceptional  facilities 
for  knowing  its  status  in  other  parts  of  the  world,  and  doubt  if 
such  constructive  progress  has  ever  been  shown  as  in  the  past 
year. 

The  backbone  of  the  Lloyd-George  movement  is  the  Single 
Tax  principle.  The  budget  fight  grew  directly  out  of  the  inclu- 
sion of  one  per  cent  tax  on  land  values  and  the  land  valuation 
clause  through  which  this  was  to  be  effectuated.  Lloyd-George 
has  now  announced  that  he  proposes  to  take  further  definite 
steps.  In  England,  although  militancy  has  driven  almost  every- 
thing else  from  the  limelight,  the  conviction  is  firmer  and  more 
general  that  the  Liberal  government  is  definitely  committed  to 
progressive  land  value  taxation. 

In  Germany  the  movement  is  organized,  and,  though  taking 
a  form  which  does  not  meet  the  full  approval  of  American  single 
taxers,  i.  e.,  the  tax  on  increment  as  now  suggested  here  in  New 
York  by  the  mayor's  commission,   is  perhaps   for  this   reason  a 


SINGLE   TAX  39 

stronger   and   more  popular   movement  than  that   in   any   other 
country. 

In  Spain,  at  Ronda,  in  May,  there  was  held  a  Single  Tax  con- 
ference, which  not  only  attracted  delegates  from  many  countries, 
but  was  also  popularly  successful,  leaving  in  its  wake  a  national 
organization  and  an  organ  of  the  movement. 

While  in  Berlin  I  received  a  message  from  one  of  the  leaders 
in  Copenhagen  that  "Denmark  would  be  the  first  nation  of  the 
earth  to  write  the  Single  Tax  into  national  law— and  that  soon." 
I  found  in  Denmark  greater  general  intelligence  and  in  some  re- 
spects stronger  organizations  than  elsewhere. 

In  Sweden,  also,  the  movement  is  well  organized,  and  one  of 
the  indications  of  its  strength  is  a  daily  paper  in  Stockholm  under 
Single  Tax  auspices. 

Besides  these  countries  there  are  nebulous  agitations  for  the 
Single  Tax  in  Italy,  France  (where  there  is  a  Single  Tax  paper) 
and  Belgium.  Australia  and  New  Zealand  have  long  been  known 
as  experiment  stations  of  the  movement.  The  latter,  especially, 
has  produced  the  most  concrete  results  up  to  the  recent  develop- 
ments in  western  Canada.  There  is  good  reason  for  believing 
that  the  new  government  of  China  will  adopt  definite  measures. 
Dr.  Sun  Yat  Sen  is  known  as  an  advocate  of  the  Single  Tax. 

Notwithstanding  these  facts,  my  opinion  is  that  the  movement 
will  hereafter  make  greater  progress  on  this  continent  than  else- 
where, and  that  Canada  is  at  present  furthest  advanced.  Van- 
couver has  taken  the  final  step  in  the  removal  of  practically  all 
taxes  from  industry,  i.  e.,  buildings,  personal  property,  etc.,  and 
the  most  reassuring  thing  regarding  her  experience  is  the  fact 
that  the  process  has  covered  a  period  of  eight  or  ten  years, 
and  four  distinct  stages,  wherein  one-quarter  of  such  taxes 
were  removed  at  each  step,  thus  proving  that  the  theory  w^as 
sound  and  its  working  satisfactory. 

The  histol-y  and  present  condition  of  Vancouver  is  the  best 
commentary  on  the  Single  Tax  that  can  be  cited.  Her  experi- 
ence has  resulted  in  a  general  trend  in  Canadian  cities  of  the 
Northwest  in  the  same  direction.  In  these  communities  the 
Single  Tax  will  be  found  in  its  early  and  cruder  stages,  and  with 
uniformly  satisfactory  results.  Furthermore,  this  influence  is 
being  definitely  felt  in  neighboring  cities  in  the  American  North- 
west, and  is  beginning  to  create  unrest  throughout  this  country. 


40  SELECTED   ARTICLES 

The  way  in  which  it  works  is  that  other  cities  become  envious  of 
the  prosperity  of  the  Single  Tax  towns,  and  join  the  movement 
in  self-defense.  This  stage  of  the  evolution  would  indicate  that 
we  are  winning  general  success. 

Some  Canadian  and  northwestern  cities  are  advertising  in  the 
United  States  to  attract  industries,  boldly  proclaiming  the  Single 
Tax  as  a  reason  why  industries  thrive  there.  The  great  influx 
of  Americans  to  Canada,  now  amounting  to  something  like 
200,000  annually,  is  doubtless  accelerated  by  the  current  reports 
of  Single  Tax  prosperity. 

It  is  necessary  to  call  attention  to  the  fact  that  the  untaxing 
of  personal  property  and  improvements  is  by  no  means  a  full 
measure  of  the  Single  Tax,  and  we  are  aware  that  stopping  at  this 
point  would  not  produce  any,  and  surely  not  all,  benefits  of  the 
unlimited  Single  Tax.  The  unlimited  tax  would  not  only  raise 
all  needed  public  revenues  from  land  values  and,  if  it  did  not 
absorb  all  the  value  of  the  land,  would  proceed  to  take  all  re- 
maining land  values,  so  that  all  speculation  in  land  would  be 
adequately  checked.  There  is  danger  that  with  merely  partial 
measures  land  speculation  would  even  be  accelerated,  so  that  the 
Single  Tax  must  not  be  judged  by  any  existing  exemplifications 
of  its  beginnings,  favorable  as  are  the  present  results. 

In  the  United  States  there  are  a  dozen  healthy  but  more  or 
less  sporadic  political  movements  directed  toward  the  Single  Tax. 
These  are  in  Rhode  Island,  New  York,  New  Jersey,  Colorado, 
California,  Oregon,  Washington,  Louisiana  and  other  states. 
Some  are  being  promoted  definitely  by  the  Joseph  Pels  Fund 
which  has  been  disbursing  from  $50,000  to  $100,000  for  several 
years  in  this  work.  But  to  my  mind  the  strength  of  the  move- 
ment is  indicated  by  the  fact  that  it  appears  in  many  respects 
most  healthy  where  unpromoted. 

In  California,  for  example,  in  1912  150,000  votes  were  cast 
in  certain  counties  for  a  tax  measure  intended  to  Open  the  way 
to  the  Single  Tax,  and  this  in  a  movement  but  a  few  months  old. 
Everett,  Wash.,  carried  a  complete  abolition  of  taxes  except  on 
land  by  a  two-thirds  vote.  Forty  per  cent  of  the  votes  in  St. 
Louis  and  Kansas  City  were  cast  for  Single  Tax  measures,  and 
one-third  of  the  voters  in  the  three  largest  counties  in  Oregon 
voted  Single  Tax.  Altogether,  nearly  400,000  voters  in  Oregon, 
Missouri,   California   and   Wisconsin   declared   for   Single   Tax. 


SINGLE   TAX  41 

Seattle  elected  a  Single  Tax  mayor,  and  a  Single  Tax  measure 
was  defeated  by  only  a  small  majorit}^  Another  campaign  is  under 
way. 

Herbert  S.  Bigelow,  one  of  the  oldest  and  most  prominent 
single  taxers  in  the  country  planned  and  carried  through  the  new 
Ohio  constitution,  although  a  specific  inhibition  of  the  Single 
Tax  was  made  a  part  of  it.  This  "victory"  Bigelow  did  not 
strenuously  contest.  A  similar  inhibition  is  now  being  sought 
by  the  frightened  interests  of  Oregon  and  Missouri.  These, 
though  negative,  are  strong  evidences  of  the  imminence  of  the 
Single  Tax,  as  in  each  of  these  three  states  the  initiative  and 
referendum,  promoted  always  by  Single  Taxers,  has  been  made  a 
part  of  the  fundamental  law.  Through  these  measures  inhibi- 
tions are  as  easily  removed  as  affirmative  laws  are  secured. 

The  1913  elections  contributed  heavily  to  publicity,  and  in 
some  cases  more  substantially.  In  Pueblo  a  contested  campaign 
was  conducted  for  50  per  cent  exemption  of  improvements  the 
first  year,  and  99  per  cent  thereafter;  carried  2,711  to  2,171 
against;  Commissioner  Burton,  Single  Taxer,  re-elected  though 
bitterly  opposed;  so  general  was  interest,  in  the  state,  that  move- 
ments are  already  under  way  in  other  cities  there.  In  Houston, 
Tex.,  J.  J.  Pastoriza  was  re-elected,  and  his  program  of  exempt- 
ing improvements  approved  by  the  voters  after  several  years 
of  practical  experience. 

In  New  York,  Benjamin  C.  Marsh  and  his  organizations 
for  "halving  taxes  on  improvements"  were  active  factors  in  the 
election  of  Mayor  Mitchel  and  twenty-seven  assemblymen, 
pledged  to  his  proposition.  That  the  mayor's  pledge  was  not 
perfunctory  may  be  concluded  from  the  fact  that  he  has  retained 
J.  J.  Murphy  and  Lawson  Purdy  in,  and  appointed  Raymond 
V.  Ingersoll  to,  his  cabinet.  All  these  men  are  Single  Taxers. 
John  J.  Hopper  was  elected  register. 

In  New  Jersey  a  spectacular  Single  Tax  campaign  was  waged 
by  George  L,  Record,  Edmund  B.  Osborne  and  others,  to  nomi- 
nate the  latter  as  governor,  on  a  plank  written  in  the  Progressive 
platform  at  the  convention.  This  failed,  but  Colby  ran  third 
on  the  issue,  which  was  widely  exploited  all  over  the  state  for 
months.  Charles  O'Connor  Hennessey,  single  taxer,  (a  brother 
of  John  A.  Hennessey,  Tammany's  Nemesis),  was  elected  to  the 
Senate,  and  E.  Yancey  Cohen,  defeated  for  Assembly. 


42  SELECTED   ARTICLES 

]\Tassachusetts  had  a  campaign  similar  to  New  Jersey's  with 
Single  Tax  a  leading  issue  with  the  Progressives,  who  came  in 
second.  Controversies  between  the  candidates,  on  this  issue, 
obtained  national  publicity. 

I  might  mention  that  there  are  at  least  thirty  single  taxers 
in  Congress,  and  a  half-dozen  governors  definitely  "under  sus- 
picion." The  fact  is  that  almost  all  statesmen  in  the  country 
are  under  similar  suspicion,  and  Single  Tax  sentiment  unquestion- 
ably pervades  many  progressive  movements. 

State  Single  Tax  leagues  have  been  organized  in  several  states 
in  the  last  year.  One  interesting  collateral  fact  is  the  extent  of 
the  agitation  for  better  methods  of  appraisal;  besides  the  general 
adoption  of  separate  valuation  of  real  estate  and  improvements 
and  of  various  improved  methods  of  real  estate  appraisal,  such  as 
that  of  President  Purdy,  of  New  York.  The  Manufacturers  Ap- 
praisal Company  of  Cleveland  is  steadily  installing  the  Somers 
system  in  large  cities  throughout  the  country.  Secretary  Lane's 
recent  messages,  especially  concerning  water  powers  and  Alaska, 
are  full  of  Single  Tax  doctrine.  The  contest  at  the  annual  meeting 
of  the  National  Conservation  Association  was  mainly  on  Single 
Tax  principles,  which  President  Pinchot  upheld  successfully. 

In  conclusion,  let  me  cite  as  further  secondary  evidences  of 
progress — equally  as  significant  as  the  numerous  events  cited — 
the  fact  that  the  three  great  national  illustrated  weeklies,  the 
Saturday  Evening  Post,  Collier's  and  Harper's,  are  all  writing 
Single  Tax  editorials.  The  Outlook  has  given  an  extensive  review 
of  the  movement.  Alore  significant  perhaps,  is  a  series  of  articles 
in  the  Real  Estate  Magazine,  the  first  of  which  is  a  veritable  call 
to  arms  in  defense  of  vested  rights — in  fact,  acknowledging  that 
the  Single  Tax  is  on  the  way  and  may  not  be  blocked  without 
arousing  those  whose  property  values  would  suffer  by  it.  The 
Atlantic  Monthly  is  publishing  a  series  of  debates  on  this  subject 
between  F.  W.  Garrison,  affirmative,  and  A.  S.  Johnson,  negative. 
The  press  generally  is  giving  generously  of  space  to  this  subject. 
An  exhibit  of  Single  Tax  literature  is  being  prepared  for  Colum- 
bia University  by  Professor  Johnston,  the  librarian. 

Altogether,  single  taxers  are  inclined  to  join  the  Real  Estate 
Magazine  in  the  admission  that  the  Single  Tax  cannot  be  stopped, 
even  by  owners   of   speculative   real  estate. 


SINGLE   TAX  43 

Outlook.  105:115-8.  September  20,  1913- 
Single  Tax. 
It  is  hardly  an  exaggeration  to  say  that  twenty-five  years 
ago  the  term  "Single  Taxer"  was  as  odious  and  terrifying  in 
the  rich  states  of  the  North  Atlantic  seaboard  as  the  term 
"abolitionist"  was  fifty  years  ago  in  the  states  of  the  South 
Atlantic  seaboard.  The  term  "Single  Tax"  was  invented  by 
Thomas  G.  Shearman,  a  distinguished  New  York  lawyer,  who 
was  an  eminent  authority  on  taxation.  Henry  George  adopted 
it  to  describe  the  method  devised  by  him  of  taxing  land  values 
so  that  the  unearned  increment,  as  he  called  it,  shall  go  to  the 
community  which  creates  it  and  not  merely  to  the  individuals 
who  now  reap  the  benefit. 

The  Single  Tax  theory  was  first  propounded  by  Mr.  George  in 
1871  in  a  book  called  "Our  Land  Policy,"  but  it  received  its  most 
famous  exposition  in  "Progress  and  Poverty,"  which  Mr.  George 
published  in  1879.  In  1882  Mr.  George  stumped  Ireland,  and 
again  in  1884  he  made  a  three  months'  tour  throughout  Great 
Britain,  speaking  in  the  principal  cities  to  large  audiences  and 
making  a  strong  impression.  In  1890  he  spent  nine  months  in  a 
trip  to  Australia  and  a  tour  around  the  world. 

What  has  been  the  progress  of  Mr.  George's  taxation  doctrine 
during  the  thirty-four  years  since  the  publication  of  "Progress 
and  Poverty"? 

This  question  is  worth  answering  because  interest  in  the 
problem  of  land  taxes  is  steadily  growing.  In  even  so  conserva- 
tive a  state  as  New  York,  a  state  in  which  the  landowning  in- 
terests are  strong  and  influential,  there  is  a  definite  movement  in 
favor  of  increasing  the  taxes  on  land  and  decreasing  them  pro- 
portionately on  improvements.  In  New  Jersey  also,  a  rich  and 
conservative  state,  the  mother  of  corporations,  the  two  promi- 
nent candidates  for  the  governorship  within  the  Progressive 
party  are  both  appealing  for  support  on  the  ground  that  they 
advocate  the  taking  of  the  burden  of  taxation  from  improve- 
ments and  transferring  it  to  land  values. 

Before  we  endeavor  to  answer  this  question  it  must  be  pointed 
out  that  there  is  a  very  widespread  error  in  the  public  mind 
regarding  the  Single  Tax.  Many  people,  perhaps  most  people 
who  have  not  looked  into  the  matter,  consider  that  the  Single 


44  SELECTED   ARTICLES 

Tax  means  the  abolition  of  private  property  in  land.  To  impose 
a  Single  Tax  on  land  values  or  ground  rent  means  nothing  of  the 
kind,  although  it  is  true  that  Henry  George  did  not  believe  in 
private  monopoly  of  land  as  at  present  existing  and  proposed  to 
use  the  Single  Tax  as  a  method  of  abolishing  it. 

It  is  obvious  that  ground  rent  or  the  unearned  increment  can 
be  taxed  at  any  rate  per  cent  chosen  by  the  taxing  authorit3^ 
Of  course,  if  the  state  takes  twenty,  fifty,  or  ninety  per  cent, 
the  individual  has  only  the  balance.  Mr,  Fillebrown,  in  INIassa- 
chusetts,  and  Messrs.  Colby  and  Osborne,  the  gubernatorial  can- 
didates in  New  Jersey,  believe  that  the  Single  Tax  can  be  applied 
to  real  estate  values  in  the  cities  of  Boston  and  Newark  in 
such  a  way  as  practically  to  take  taxation  entirely  from  im- 
provements, thus  fostering  and  developing  improvements,  and 
yet  leaving  a  reasonable  share  of  the  increasing  ground  rent  or 
land  value  or  unearned  increment  to  the  private  owners. 

We  believe  it  will  surprise  some  of  our  readers,  as  it  has  sur- 
prised us,  to  learn  what  the  progress  of  the  Single  Tax  has  been 
in  the  various  parts  of  the  world  in  the  last  few  years.  We 
are  enabled  to  give  this  record  through  information  collected, 
condensed,  and  arranged  by  Mr.  C.  B.  Fillebrown,  one  of  the 
best-known  and  best-informed  authorities  on  the  so-called  Single 
Tax. 

Great  Britain  has  been  the  last  to  move,  and  her  first  step 
was  comparatively  a  short  one.  The  Lloyd  George  Budget  of 
1909,  which  finally  became  a  law  in  1910,  imposed  four  different 
taxes  upon  land,  the  first  and  most  important  of  which  was  the 
so-called  increment  value  duty.  This  imposes  a  tax  of  20  per 
cent  upon  land  increment  arising  after  1909,  payable  by  the 
owner  when  land  is  sold,  leased  for  more  than  fourteen  years, 
or  transferred  at  death.  Land  held  by  corporate  bodies  and 
not  changing  hands  is  to  pay  the  tax  every  fifteen  years.  To 
carry  the  law  into  effect  it  was  necessary,  of  course,  to  provide 
for  a  complete  appraisal  of  all  the  land  in  Great  Britain,  in 
order  to  determine  its  value,  exclusive  of  improvements,  in  the 
year  1909.  This  work,  which  is  estimated  to  cost  $10,000,000 
and  to  require  five  years,  is  now  under  way,  and  it  will  result 
in  a  monumental  survey  comparable  to  Doomsday  Book. 

In  the  German  Empire  the  first  of  the  recent  experiments  in 
taxing  the  increment  of  land  was  made  in  the  model  German 


SINGLE   TAX  45 

colony  of  Kiaochau,  established  in  China  in  1897.  The  land  and 
tax  ordinance  of  1898  imposed  a  tax  of  ^s^i  per  cent  of  any  in- 
crement of  value  accruing  thereafter  to  private  purchasers  of 
lands  acquired  from  the  Government,  a  tax  of  6  per  cent  on  the 
value  of  land,  exclusive  of  improvements,  and  a  tax  on  land  sales 
at  auction.  This  ordinance  suddenly  and  unexpectedly  realized 
the  German  land  reformers'  programme  in  a  German  colony 
under  the  direct  control  of  the  Imperial  Government.  It  naturally 
aroused  great  interest,  and  soon  led  to  attempts  to  tax  the  un- 
earned increment  in  various  German  cities.  Frankfort  and 
Cologne  took  the  lead,  in  1904  and  1905.  Their  example  was 
rapidly  followed  by  scores  of  other  municipalities,  including  most 
of  the  large  cities,  until  by  1910  the  increment  tax  was  in  opera- 
tion in  457  cities  and  towns  and  was  yielding  a  substantial 
revenue.  The  rates  of  taxation  ranged  from  i  per  cent  to  25 
per  cent  of  the  amount  of  the  increment. 

In  191 1  the  German  Empire  introduced  an  Imperial  incre- 
ment tax.  This  law  imposes  a  progressive  tax,  increasing  ac- 
cording to  the  percentage  which  the  increment  bears  to  the 
original  value  of  the  land.  The  rate  is  10  per  cent  of  the  incre- 
ment when  that  amounts  to  10  per  cent  of  the  original  value,  and 
increases  i  per  cent  for  each  additional  20  per  cent  of  increment 
until  it  reaches  19  per  cent  on  increments  ranging  from  170  per 
cent  to  190  per  cent.  From  that  point  it  increases  i  per  cent 
for  every  additional  10  per  cent  of  increment,  until  it  reaches 
30  per  cent  on  all  increments  of  290  per  cent  and  over,  with 
provision  for  certain  deductions.  The  Imperial  tax  is  intended 
to  unify  the  taxation  of  the  unearned  increment  throughout  the 
Empire,  and  will  replace  the  local  increment  taxes.  To  com- 
pensate the  cities  for  the  revenue  thus  lost,  the  law  provides 
that  40  per  cent  of  the  product  of  the  Imperial  increment  tax 
shall  be  apportioned  to  the  local  governments ;  while  the  states 
are  given  10  per  cent,  and  the  Empire  retains  50  per  cent.  Au- 
thority is  granted,  however,  to  impose  additional  rates  for  local 
purposes ;  so  that  some  measure  of  local  option  is  retained. 

In  Australia  Queensland  has  already  adopted  the  exemption 
of  all  improvements,  and  New  South  Wales,  South  Australia, 
and  every  other  state,  as  well  as  the  Federal  Government,  are 
moving  steadily  in  the  same  direction. 

Nezv  Zealand  has  had  a  graduated  state  land  tax  since  1891, 


46  SELECTED   ARTICLES 

which  has  already  to  a  great  extent  accompHshcd  its  purpose  of 
breaking  up  large  estates.  In  1896  local  bodies  were  empowered 
to  levy  their  rates  on  the  unimproved  value  of  land.  By  1909 
not  less  than  eighty-five  districts  had  adopted  the  method,  with 
satisfactory  results. 

Of  the  nine  Canadian  provinces  three  have  taken  important 
steps  toward  the  Single  Tax.  In  British  Cohunbia  provincial  rev- 
enue is  still  derived  from  poll,  property,  and  income  taxes,  but 
since  1891  municipalities  have  been  permitted  to  exempt  improve- 
ments from  taxation  in  part  or  in  whole.  Since  1892,  indeed, 
municipalities  have  not  been  permitted  to  assess  improvements 
at  more  than  50  per  cent  of  their  actual  value.  Under  the  author- 
ity thus  granted  all  the  important  urban  and  many  rural  muni- 
cipalities now  exempt  improvements  entirely,  thus  raising  practi- 
cally all  local  revenue  from  land.  The  Government,  through  its 
Finance  Minister,  the  Hon.  Price  Ellison,  now  formally  announces 
its  purpose  to  adopt  the  Single  Tax  for  all  provincial  revenues. 
He  says :  "Our  aim  is  to  reach  a  point  where  direct  taxation  will 
be  eliminated  and  our  revenues  will  be  obtained  from  the 
natural  resources  of  the  province.  This  I  regard  as  a  sound 
policy." 

In  the  Province  of  Alberta  there  were  established  in  1912 
fifty-two  municipalities,  which  are  required  to  levy  their  taxes 
on  land  values  only.  The  same  is  true  of  seventy-four  villages, 
also  of  forty-four  out  of  forty-six  towns.  In  1912  the 
province  enacted  laws,  practically  without  opposition,  requiring, 
with  two  exceptions,  all  towns,  all  rural  municipalities,  and  all 
villages  to  raise  their  local  revenues  from  taxes  assessed  upon 
land  according  to  its  actual  cash  value.  The  five  cities  of 
Alberta  have  special  charters  granting  wide  discretion.  Edmon- 
ton has  exempted  all  improvements  since  1904,  and  the  others 
are   following  suit. 

In  Saskatchewan  about  twenty  villages  confine  taxation  to 
land  alone.  This  province  has  just  passed  a  new  act  requiring 
all  rural  municipalities  to  raise  their  revenue  from  taxation  of 
land  values  exclusively,  and  imposing  a  graduated  surtax, 
beginning  in  1914,  upon  unoccupied  lands.  Its  main  feature  is 
the  imposition  of  a  tax  of  $40  per  section  of  640  acres  upon 
land  of  any  owner  or  occupant  exceeding  640  acres  which  has 
less  than  one-half  its  area  under  cultivation. 


SINGLE   TAX  47 

In  Ontario  300  municipalities  have  petitioned  for  power  to 
reduce  taxes  on  improvements.  By  twenty-three  to  one  the 
Toronto  City  Council,  in  January,  1913,  submitted  to  the  citizens 
the  question  of  exempting  buildings,  whereupon  the  citizens 
voted  in  the  affirmative  four  to  one. 

In  contrast  with  these  gradual,  patient  British  and  Colonial 
attainments,  the  record  of  the  United  States  for  actual  achieve- 
ment is  a  comparative  blank.  This  condition  in  the  birthplace 
and  home  of  the  great  expounder  himself  is  not  easy  to  account 

"""^The  chief  factor  in  the  practical  attitude  of  the  two  nations 
is  the  difference  between  the  English  and  American  methods 
of  procedure.  In  England  the  voters  begin  at  once  to  discuss 
among  themselves  the  advantages  of  the  land  tax,  and  straight- 
way, by  the  very  cohesion  of  a  common  thought,  they  set  about 
to  get  it,  with,  as  it  were,  one  heart  and  voice,  by  enactment  of 
land  laws.  In  this  country  the  voters  are  of  a  different  type; 
they  are  mostly  too  busy  to  concern  themselves  with  making 
even  their  own  laws.  Consequently  the  cause  has  been  consigned 
to  scattered  organizations,  which  have  proceeded  to  discuss 
the  theoretical' possibilities^ and  impossibilities  and  probabihties 
of  every  phase  of  the  Land  Tax  question,  combined  with  other 
questions  more  or  less  related,  to  the  end  of  the  catalogue. 

The  moral  is  that  education  and  not  partisan  propaganda  is 
the  surest  path  to  the  triumph  of  that  economic  justice  which 
aloiie  can  solve  our  economic  problems. 


Tax   Reform  League,   Seattle. 
Erickson  Single  Tax  Amendment. 

1.  The  Erickson  Amendment  does  not  affect  state  or  county 
taxes  at  all.     It  affects  only  city  taxes. 

2.  It  exempts  from  city  taxes  the  improvements  on  land; 
that  is,  buildings,  factories,  etc.,  and  personal  property-house- 
hold goods,  machinery,  stocks  of  goods,  tools,  etc. 

3  It  taxes  land  values  merely,  whether  there  are  buildmgs 
on  the  land  or  not,  and  it  taxes  the  franchises  of  public  service 
corporations,  such  as  the  Seattle  Electric  Company,  the  Seattle 
Lighting  Company   (gas  company),  etc.     Besides,  it  taxes  such 


48  SELECTED   ARTICLES 

leasehold  interests  in  land  as  that  given  by  the  state  on  the 
"old  university  grounds." 

4.  The  assessed  values  of  the  land  will  not  be  raised  or 
lowered  by  the  Amendment, — it  affects  only  the  rate  or  per- 
centage of  taxes  paid;  it  reduces  the  rate  (for  city  taxes)  on 
improvements  and  personal  property  to  nothing. 

The  total  tax  rate  for  state,  county,  school  and  city  is  30  mills, 
or  $3.00  on  $100  of  assessment.  The  part  of  this  tax  for  city 
purposes  is  14  mills,  or  $1.40  on  $100  of  assessment, — almost 
one-half. 

The  general  effect  of  the  Erickson  Amendment,  then,  will 
be  to  take  nearly  half  of  the  total  tax  (for  all  purposes,  city, 
county,  school  and  state)  off  of  buildings  and  personal  property 
(47%  is  the  exact  amount)  and  this  tax,  of  which  buildings  and 
personalty  are  relieved,  will  fall  on  land,  both  vacant  and  im- 
proved (and  on  franchises)  ;  the  total  tax  for  all  purposes  on 
land,  vacant  and  improved  (and  on  franchises)  will  be  25% 
higher  than  now. 

Every  man  can  figure  for  himself  the  change  this  Amend- 
ment will  make  in  his  own  tax. 

I — Find  out  the  total  tax  on  land,  and  on  buildings  and 
personal  property,   separately. 

2 — Subtract  one-half  (47%  to  be  exact)  from  the  tax  paid 
on  buildings  and  personal  property. 

3 — Add  one-quarter  to  the  tax  on  land  alone,  whether  vacant 
or  improved. 

Business   Property    Will   Pay   More.    Residence    Property    Will 
Pay  Less.. 

The  Erickson  Amendment  will  shift  taxes  from  residence 
property  to  business  property.     Here  is  the  proof : 

BUSINESS    PROPERTY 

On  two  sides  of  Second  Avenue,  between  Yesler  Way  and 
Pike  Street,  there  are  85  lots.  Their  total  assessed  values  are 
as  follows : 

Assessed  value  of  land $  9,179,250 

Assessed  value  of  buildings 2,719,690 

Total $11,898,940 


SINGLE   TAX  49 

The  191 1  tax  NOW  makes  these  85  lots  with  the  improve- 
ments pay  $403,374  per  year.  Under  the  Erickson  Amendment 
(under  which  buildings  would  pay  less  and  land  values  would 
pay  considerably  more  than  now)  these  properties  would  pay 
$441,894— an  increase  of  $38,520. 

The  same  thing  is  true  of  Third  Avenue,  between  Yesler  Way 
and  Pike  Street.     The  present  assessed  values  are  as  follows : 

Assessed  value  of  land $5,286,180 

Assessed  value  of  buildings 809,180 

Total $6,095,360 

The  present  tax  paid  by  these  properties  is  $206,631 ;  under 
the  Erickson  Amendment  they  would  pay  $242,576 — an  increase 
of  $35,945. 

It  is  important  to  remember  that  this  additional  sum,  to  be 
paid  by  the  landlords  of  business  property,  cannot  make  the 
cost  of  living  higher;  they  cannot  charge  more  rent  and  thereby 
increase  prices,  for  the  rent  is  now  (and  always  is)  at  the 
highest  point  which  people  can  or  will  pay. 

RESIDENCE     PROPERTY 

In  the  Moore's  University  Park  Addition,  lying  north  of  the 
University  campus,  a  comparison  of  the  191 1  taxes  with  the 
Single  Tax  on  the  same  property  under  the  Erickson  Amendment 
is  as  follows : 

Improved  lots.     Vacant  lots. 

1911  taxes  for  all  purposes $6,023  $  9,427 

Under   Erickson   Amendment 4,297  12,029 

Decrease  $1,726   Increase  $2,602 

A  total  saving  to  the  ones  who  have  improved  their  property 

of  $1,726.    The  average  assessed  valuation  of  the  improved  lots 

is  $660  and  of  the  houses  $1,690,  total  $2,350. 

1911  taxes  for  all  purposes $78.00 

Under  Erickson  Amendment 57.80 

Each  home-owner  would  save  $20.20 
GREEN    LAKE 

In  the  whole  of  Burns  &  Atkinson's  Addition,  located  in  the 
heart  of  the  Green  Lake  District  on  the  east  side  of  the  lake, 
the  191 1  taxes  compare  with  the  Single  Tax  under  the  Erickson 
Amendment,  as  follows : 


50  SELECTED   ARTICLES 


Improved  lots.     Vacant  lots. 

1911   taxes  for  all  purposes $5,089  $1,236 

Under  Erickson  Amendment 4,089  1,578 


Decrease  $1,000     Increase  $342 


In  Gilman   Park,   Ballard,   Blocks   1-53 : 

Improved  lots.  Vacant  lots. 

1911  taxes  for  all  purposes $15,830        *  $3,679 

Under  Erickson  Amendment 13,948  4,709 


Decrease  $1,882     Increase  $1,030 

Mr.  C.  J.  Smith  lives  at  6539  Earl  Street,  N.  W.,  Seattle. 
In  191 1  he  paid  $36.95  tax  for  state,  county,  school  and  city 
purposes  on  his  house  and  two  lots — $30.23  of  this  was  the  tax 
on  his  house  and  $6.72  was  the  tax  on  his  two  lots  (^3-3^  each). 
If  the  Erickson  exemption  amendment  (to  be  voted  on  March 
5th,  1912)  had  been  in  force  he  would  not  have  had  to  pay  any 
city  tax  on  his  house.  The  tax  on  his  house  would  have  been 
reduced  one-half— from  $30.23  to  $1512;  his  lot  tax  would 
have  risen  to  $8.40  ($4.20  each)  ;  he  would  have  paid,  altogether, 
$23.52  instead  of  $36.25  as  now. 

Public   14:233-4.    March   10,    1911. 
Taxation  of   Land  Values   in   Canada. 

Portions  of  Special  Correspondence  from  Edmonton,  published  in  the 
Toronto   Daily  Star   of   October   22,    19 10. 

\  Edmonton  may  be  called  the  home  of  the  Single  Tax.  Though 
ilie  name  of  Edmonton  has  been  on  the  map  for  over  a  hundred 
Tears,  the  period  of  its  larger  growth  may  conveniently  be 
(kted   from  1904,  the  year  the  city  charter  was  granted. 

In  the  charter  the  principle  of  the  Single  Tax  was  adopted 
as  the  basis  of  assessment  and  taxation,  that  is,  taxation  on 
land  values  only,  with  no  tax  on  improvements;  and  this  being 
now  the  sixth  year  of  its  operation,  it  is  of  interest  to  inquire 
how  it  works   out,   and  how  the  people  like  it. 

The  Single  Tax  idea  was  modified  by  the  addition  of  business 
and  income  taxes,  but  the  head  of  opinion  here  is  towards  tax- 
ation of  land  values  pure  and  simple,  and  it  is  probable  that  in 
a  few  years'  time  the  business  and  income  taxes  will  be  discarded. 


SINGLE   TAX  51 

The  people  like  the  system.  One  hears  no  sentiment  at  all  in 
favor  of  going  back  to  assessment  of  building  or  improvement 
values.  It  is  simple  and  easy  of  administration  and  equitable 
in  results.  It  prevents,  or  at  least  tends  to  prevent,  the  holding 
of  land  vacant  for  speculative  purposes.  Two  pieces  of  land 
equally  well  located,  one  vacant,  and  the  other  with  a  million 
dollar  building  on  it,  would  contribute,  outside  of  the  business 
tax,  exactly  the  same  amount  to  the  city  funds,  so  that  one  can 
see  that  the  holding  of  land  vacant  or  with  cheap,  light  revenue 
producing  buildings  is  not  apt  to  be  a  profitable  venture  for  any 
great  length  of  time.  Of  course  the  recent  rise  in  land  values 
has  been  so  rapid  and  so  phenomenal  in  extent  that  so  trifling 
a  thing,  in  comparison,  as  taxation  has  hardly  been  given  a 
thought;  but  taxation  necessarily  keeps  pace  with  rise  in  land 
values,  and  in  the  long  run  it  will  not  pay  to  hold  on  to 
unimproved  town  sites. 

Outside  the  business  center  it  costs  no  more  taxation  to  carry 
improved,  revenue-producing  property  than  it  does  vacant  land 
similarly  situated,  and  that  fact  alone  must  in  the  long  run 
result  in  a  compact,  well-built-up  city,  and  it  is  as  well  a  factor 
to  be  taken  into  consideration  in  the  purchase  of  outlying  lands 
in  the  corporation. 

The  corporation  of  Edmonton  embraces  now  about  ten 
thousand  acres.  It  has  a  total  assessment  of  thirty  millions 
and  a  tax  rate  this  year  of  seventeen  mills  on  the  dollar.  The 
general  assessment  is  based  on  land  value  only,  fixed  by  the 
assessor.  He  is  guided  in  fixing  this  value  by  recent  sales,  by 
his  knowledge  of  the  property,  its  location,  etc.,  and  in  arriving 
at  this  he  pays  no  attention  to  the  character  of  the  building  or 
whether  it  has  any  building  on  it  at  all  or  not. 

The  satisfaction  given  by  the  system  of  taxation  followed  in 
Edmonton  has   induced  other  corporations  to   follow   suit. 

Strathcona,  the  city  across  the  river,  with  5,000  inhabitants, 
imbedded  the  system  into  its  charter.  This  year  that  city  has 
progressed  so  far  towards  the  pure  Single  Tax  as  to  cut  its 
business  tax  in  half. 

The  City  of  the  Plains,  Regina,  investigated,  and  adopted  the 
plan. 

The  biggest  city  of  the  West,  the  young  giant  of  the  coast, 
Vancouver,  has  gone  the  full  length,  and  this  year  adopts  the 


52  SELECTED   ARTICLES 

Single  Tax  pure  and  simple,  land  values  only,  without  business 
tax.  The  result  there  will  be  watched  with  the  widest  interest. 
It  is  the  first  to  go  the  whole  hog,  and  to  go  it  on  an  extensive 
scale. 

Enquiries  and  delegations  from  many  parts  of  Canada,  and 
from  many  parts  of  the  United  States  as  well,  have  reached 
Edmonton  on  investigation  bent,  and  the  system  may  already 
be  said  to  have  obtained  a  solid  foothold  in  the  West. 

The  simplicity  and  ease  of  administration  of  the  system  is 
one  of  its  chief  beauties.  It  is  much  easier  to  compare  and 
equivalate  assessment  of  land  than  of  buildings  or  personal 
property.  There  are  practically  no  appeals  made  from  assessed 
values  as  such.  The  whole  business  of  the  Court  of  Revision 
for  the  city  is  disposed  of  in  a  sitting  of  an  hour  or  two 
duration. 

No  doubt  a  good  part  of  its  success  here  is  due  to  the  service 
of  a  competent  and  impartial  official  who  deservedly  gained 
the  confidence  of  the  rate  payers.  To  the  assessor  and  tax 
collector,  which  offices  in  Edmonton  are  combined  in  the  person 
of  that  dour  yet  canny  Glaesca'  chiel,  Mr.  D.  M.  McMillan,  is 
due  much  of  the  credit  for  the  inauguration  and  successful 
operation  of  the  system  in  the  city.  He  has  perfected  the 
details  so  that  it  runs  along  like  clockwork,  and  he  is  given 
practically  a  free  hand  in  working  it  out.  To  him  and  to  the 
genial  mayor  of  the  city,  Mr.  Robert  Lee,  we  are  indebted  for 
the  particulars  from  which  the  scheme  has  been  outlined  above. 

Everything  is  not  lovely,  however,  not  even  with  the  Single 
Tax.  When  the  city  takes  on  growing  pains  and  demands  room 
for  expansion,  the  outlying  districts  do  not  want  to  come  into 
the  charmed  Single  Tax  area.  Their  assessment  would  be 
mostly  all  land  values,  and  they  claim  that  the  parts  of  the  city 
where  extensive  improvements  exist  free  of  taxation  would  get 
them  the  best  of  the  bargain.  They  demand  concessions,  and 
Edmonton  had  to  grant  their  demands  to  coax  them  in.  The 
city  agreed  that  for  five  years  their  assessment  would  be  made 
for  school  purposes  only,  and  it  will  be  three  years  yet  before 
the  added  area  pays  full  taxes. 

Strathcona  agreed  that  until  the  farm  lands  were  sub-divided 
and  sold  they  would  only  be  assessed  at  $io  per  acre,  equal 
only  to  a  trifling  assessment  of  $io  each  for  a  town  lot.     The 


.SINGLE   TAX  53 

sub-divisions  of  farm  lands  spring  up  all  around  the  fringe 
of  the  corporations,  where  land  is  cheap  and  taxation  very  light, 
and  residents  still  have  the  advantage  of  contiguity  to  a  center 
of  population.  This  kind  of  thing  occurs  in  every  city,  of 
course,  but  the  tendency  thereto  seems  to  be  increased  by  the 
Single  Tax  System. 


Public.     15:436-8.     May  10,  1912. 

Typical  Objections  to  Land  Value  Taxation. 

Objection:  The  Single  Tax  places  the  financial  burdens  of 
government  upon  producers,  though  all  receive  equal  protection 
and  benefits.  Answer:  (i)  The  Single  Tax  exempts  all  producers 
from  all  taxation.  (2)  It  takes  for  public  revenues  only  land 
values,  those  values  of  land  which  are  due  not  to  individual 
effort  but  to  general  conditions.  (3)  To  the  extent  that  those 
values  are  untaxed  for  general  use,  the  benefits  of  government 
are  not  equal;  for  land  owners  are  thereby  allowed  private 
incomes  out  of  a  common  fund. 

Objection:  The  Single  Tax,  when  applied  to  the  fullest  extent, 
is  destructive  to  land  values.  Answer:  (i)  As  to  capitalized 
land  values  (selling  price),  this  is  true;  but  as  to  annual  land 
values  (ground  rent),  it  is  not  true  except  to  the  degree  that 
ground  rent  is  now  abnormally  high  because  land  speculation 
abnormally  lowers  the  supply  of  land.  (2)  Both  as  to  capital 
value  and  annual  value,  the  Single  Tax  would  deprive  land 
owners  of  only  so  much  land  value  as  is  due  not  to  individual 
effort  but  to  general  conditions — approximately  to  the  full  if  fully 
applied,  and  in  degree  if  only  partly  applied. 

Objection:  In  this  country  land  values  do  not  belong  to  the 
people  as  a  whole,  because  the  government,  which  is  of  the 
people,  has  by  Constitutional  laws  duly  conveyed  the  public 
domain  to  individuals  for  a  consideration.  Answer:  (i)  No 
government  of  the  past  may  irrevocably  sell  in  perpetuity  the 
natural  heritage  of  future  generations.  (2)  Our  government 
never  sold  the  land  values  of  the  present  and  future;  and  could 
not,  for  that  would  be  in  effect  the  sale  in  perpetuity  of  a 
power  of  private  taxation.  (3)  As  the  Constitutions  and  laws 
under   which   our   government   sold   were  by   their   own   terms 


54  SELECTED   ARTICLES 

amendable,  any  rights  acquired  arc  subject  to  that  reservation; 
and  when  those  laws  and  Constitutions  are  duly  amended,  all 
transactions  under  them  are  void  if  the  amendment  so  declares 
or  to  the  extent  that  it  so  declares.  Therefore,  the  question 
raised  by  a  Single  Tax  amendment  is  not  whether  it  would  destroy 
private  ownership  of  land  values  but  whether  it  is  in  the  public 
interest.  Any  of  our  Constitutions  and  laws  which  provide  that 
all  property  shall  be  taxed,  may  be  amended  without  depriving 
any  one  of  any  rights.  The  power  of  taxation  is  a  power  about 
which  all  publicists  are  agreed  that  it  must  not  be  tied  up. 

Objection:  The  shifting  of  taxes  from  improvements  to 
land  values  would  increase  taxes  on  improved  real  estate  where 
the  value  of  the  building  is  less  than  the  value  of  the  land, 
thereby  lessening  taxes  on  skyscrapers  and  palaces  and  increasing 
them  on  cottages  and  vacant  land.  Answer:  (i)  If  taxes  were 
increased  on  improved  property  wdiere  the  value  of  the  build- 
ing was  less  than  the  value  of  the  land,  the  increase  would  be 
at  the  expense  of  land  monopoly  and  to  the  gain  of  the  building 
trades.  What  real  objection  is  there  to  this?  (2)  To  exempt 
palaces  and  skyscrapers  would  tend  to  make  palaces  and  sky- 
scrapers cheaper,  and  thereby  to  increase  employment  and  stim- 
ulate trade  in  building  lines;  to  increase  advalorem  taxes  on 
vacant  land  would  tend  to  make  all  land  cheaper,  and  thereby 
to  increase  employment  and  stimulate  trade  in  all  lines.  (3)  To 
increase  taxes  on  cottage  sites  while  lessening  taxes  on  cottages 
is  quite  a  different  thing   from   increasing   taxes   on  cottages. 

Objection:  It  would  so  reduce  the  value  of  vacant  land  as  to 
wipe  out  slender  mortgage  equities.  Answer:  If  the  tax  were 
high  enough  this  would  be  true.  If  it  were  enough  higher  it 
would  wipe  out  the  whole  capital  value  of  vacant  land.  But  if 
it  did  either,  only  land  monopolists  would  lose  while  land  users 
would  benefit.  Since  one  or  the  other  must  lose,  which  shall 
it  be? 

Objection:  It  w^ould  encourage  intensive  use  of  land,  thus 
increasing  congestion.  Answer:  This  objection  needs  explana- 
tion in  connection  with  the  one  immediately  preceding.  If 
shifting  taxes  from  the  value  of  improvements  to  the  value 
of  sites  would  reduce  the  value  of  vacant  land,  how  could 
it  increase  congestion?  Do  people  huddle  most  where  land  is 
cheap,  or  where  it  is  dear? 


SINGLE   TAX  55 

Objection:  The  expense  of  civil  government  is  for  the  pro- 
tection and  benefit  of  buildings  and  not  of  vacant  land.  Answer: 
How  much  would  vacant  land  be  worth  in  the  real  estate  market 
of  any  community  where  titles  to  land  were  not  protected? 
Little  or  nothing.  Civil  government  increases  the  market  value, 
not  of  building,  but  of  land.  It  must  therefore  be  for  the 
benefit,  not  of  buildings  but  of  land,  including  vacant  land. 
Does  any  one  honestly  and  seriously  deny  it? 

Atlantic  Monthly.  113:545-8.  April,  1914. 

Third  View  of  the  Single  Tax.     Evans  Woollen. 

The  Case  for  the  Single'  Tax  having  been  stated,  and  the 
Case  against  the  Single  Tax,  there  is  reason  perhaps  for  stating 
the  Case  of  the  Single  Tax.  For  notwithstanding  these  years 
of  disputation  it  is  not  quite  clear  that  we  are  all  talking  about 
the  same  thing  when  we  talk  about  the  Single  Tax.  Indeed, 
the  term  seems  sometimes  a  hardly  less  slippery  one  than  Social- 
ism. Thus,  in  the  December  Atlantic,  Mr.  Garrison  defines  the 
Single  Tax  as  a  method  of  raising  money  for  the  necessary 
expenses  of  government,  and  then  proceeds  to  the  advocacy  of  a 
project  not  fiscal  in  its  primary  purpose  but  social.  It  is  not  a 
method  of  raising  money  related  in  amount  to  the  necessities 
of  government,  that  he  advocates,  but  a  method  of  abolishing 
private  property  in  land,  a  method  whose  application  would  indeed 
raise  money  available  for  the  expenses  of  government,  but 
incidentally,  and  in  amount  related  to  the  value  of  the  private 
property  to  be  abolished,  and  quite  unrelated  to  the  necessities 
of    government. 

The  aboHtion  of  private  property  in  land  is  one  thing. 
Governmental  appropriation  of  the  unearned  increment  in  land- 
values  is  another.  A  third  is  the  taxation  of  land-values.  And 
there  seems  not  infrequently  to  be  failure  to  discriminate  the 
one  from  the  other,  and  the  third  from  the  first  two.  All  three 
were  involved  in  Henry  George's  propaganda.  The  end  he 
sought  was  the  abolition  of  private  property  in  land.  Govern- 
mental appropriation  of  the  unearned  increment,  appropriation 
in  the  name  of  taxation,  was  the  means.  He  attracted  to  his 
standard — 


56  SELECTED   ARTICLES 

1.  Those  who,  with  himself,  favored  a  tax  that  would  take 
the  whole  rental  value  of  land  and  thus  abolish  private  property 
therein. 

2.  Those  who,  not  favoring  the  abolition  of  private  property 
in  land,  yet  believed  with  John  Stuart  Mill  that  the  state  should 
appropriate  the  future  increment  in  land-values  which  is  said 
to  be  unearned.     And 

3.  Those  who,  favoring  neither  the  abolition  nor  the  appro- 
priation, yet  believed  that  land  independent  of  improvements 
thereon    or    therein    should    bear    a   larger    burden    of   taxation. 

And  thus  three  things  have  been  confounded,  and  the  term 
Single-Taxers  has  come  to  include  those  who  believe  in  any 
of  the  three. 

Toward  the  first  of  these,  the  "abolition  of  private  property 
in  land,  this  w-orld  of  ours  that  takes  little  stock  in  doctrines  of 
natural  rights  has  made  no  appreciable  progress  since  George's 
time.  No  advocate  of  commanding  influence  has  appeared 
since  the  desertion  of  Herbert  Spencer,  and  the  interest  in  the 
subject  remains  academic  rather  than  political. 

Such  progress  as  has  been  made  under  the  name  of  the 
Single  Tax  has  been  toward  the  second  of  the  three  things 
confounded, — the  governmental  appropriation  of  the  unearned 
increment  in  land-values,  a  social  project  for  ameliorating  the 
evils  of,  without  abolishing,  private  property  in  land;  and 
toward  the  third, — the  increased  taxation  of  land-values,  a 
fiscal  project  for  raising  money  for  the  necessary  expenses  of 
government. 

It  was  the  second  that  engaged  Mill  and  his  Land-Tenure- 
Reform  Association.  They  sought  to  ameliorate  the  evils  of 
private  ownership  through  "the  interception,"  to  use  the  language 
of  the  association's  platform,  "by  taxation  of  the  future  un- 
earned increase  of  the  rent  of  land  (so  far  as  the  same  can  be 
ascertained),  or  a  great  part  of  that  increase."  By  the  rent  of 
land  they  meant,  of  course,  economic  rent,  that  rent  which 
is  a  remuneration  for  the  use  of  what  Ricardo  called  "the 
original  and  indestructible  powers  of  the  soil."  They  proposed 
to  take  the  unearned  increment  by  using  the  taxing  machinery. 
It  might  be  taken  otlierwise.  They  proposed  to  distribute  the 
unearned  increment  by  using  it,  in  lieu  of  taxes,  for  the 
expenses    of   government.      It    might    be    distributed    otherwise. 


SINGLE   TAX  57 

These  two  matters  of  method  should  not  be  allowed  to  confuse 
the  consideration  of  the  merits  of  the  appropriation  of  unearned 
increment. 

Confusion  has  arisen,  too,  from  overlooking  the  fact  that 
unearned  increment  does  not  mean  an  increment  in  value  un- 
earned by  any  one.  It  means  an  increment  not  attributable  to 
the  owner  or  his  predecessors  in  the  title.  That  there  is  in 
this  sense  an  unearned  increment  in  land-values  is  not  questioned. 
Indeed,  any  increment  in  land-value  will  be  found,  as  George 
says,  to  have  "social  growth  as  its  basis.  ...  A  man  may 
work  or  spend  on  land  to  any  amount;  but  no  matter  how 
valuable  his  improvements,  the  land  itself  acquires  no  value 
except  as  the  community  around  it  grows  and  improves,  or 
access  to  larger  populations  is  opened."  Would  it  not  be  right 
to  appropriate  this  increment  to  the  use  of  those  who  have 
earned  it?  Would  it  not  be  right  to  appropriate  the  increment 
in  the  Duke  of  Bedford's  Covent  Garden  estate, — that  estate 
which  was  worth  some  thirty  dollars  a  year  when  it  came  to 
his  family  and  was  worth  one  hundred  and  twenty  thousand 
dollars  a  year  when,  afraid  it  is  said  of  what  Lloyd  George 
might  do,  he  recently  sold  it  for  fifteen  milHons?  Undoubtedly, 
the  appropriation  of  all  increments  to  the  use  of  those  who 
have  earned  them  would  be  rightful.  But  many  things  are 
rightful  enough  that  are  neither  practicable  nor  expedient. 
And  the  world  seems  quite  to  have  made  up  its  mind  that  the 
comprehensive  and  theoretically  correct  appropriation  and 
distribution  of  unearned  increments  is  one  of  these. 

It  is  impracticable  because  the  comprehensive  and  theoreti- 
cally correct  appropriation  of  unearned  increments  would  have 
to  be  regardful  not  only  of  land-values  but  also  of  all  the  other 
monopolies  in  which  unearned  increments  are  likely  to  show 
themselves;  and,  as  others  have  pointed  out,  would  have  to 
be  regardful  of  unearned  decrements  as  well  as  of  unearned 
increments. 

And  the  distribution— what  of  that?  Who  have  earned  and 
are  accordingly  entitled  to  these  increments  which  the  owners 
have  not  earned?  What  share  has  the  parasite  earned  and 
what  share  the  community-builder?  To  use  the  appropriated 
increments  in  lieu  of  taxes  is  not  of  course  to  answer  the 
question. 


S8  SELECTED   ARTICLES 

It  is  inexpedient  to  appropriate  unearned  increments  com- 
prehensively because,  as  Professor  Johnson  pointed  out  in  the 
January  .Itlantic,  the  chance  of  the  unearned  increment  is  a 
motive  that  we  could  not  well  do  wholly  without.  The  chance 
of  getting  more  than  is  allowed  by  the  stern  logic  of  the 
theorist  has  started  and   finished  much  good  work. 

But,  while  this  w'ork-a-day  world  is  not  showing  much 
interest  in  the  appropriation  and  distribution  of  unearned 
increments  in  anything  like  a  comprehensive  and  theoretically 
correct  way,  it  is,  in  its  blundering  fashion,  showing  interest  in 
some  compromises  on  the  subject.  It  was  with  reference  to 
these  that  I  said  above  that  progress  had  been  made,  under 
the  name  of  the  Single  Tax,  toward  governmental  appropria- 
tion of  the  unearned  increment. 

The  compromises  referred  to  are  the  British  and  German 
increment  taxes  mentioned  by  ]\Ir.  Garrison,  and  described  in 
the  1913  edition  of  Professor  Seligman's  Essays  in  Taxation. 
The  British  increment  tax  is  one  of  the  four  land-taxes  of 
1909.  A  fifth  of  the  increment  in  the  site-value,  above  a  non- 
taxable increment  of  ten  per  centum,  is  taken  by  the  government 
when  the  land  changes  hands  or,  in  the  case  of  land  not 
changing  hands,  every  fifteen  years.  This  legislation  followed 
interesting  increment  taxes  in  the  German  Colony  of  Kiauchau 
in  1898,  and  in  a  great  many  of  the  German  municipalities. 
The  latter  were  supplanted  in  191 1  by  an  imperial  increment 
tax.  This  tax  is  levied  on  the  difference  between  the  selling 
price  of  real  estate  and  the  purchase  price  plus  the  cost  of 
improvements.  The  rate  varies  in  accordance  with  the  ratio 
of  the  increment  to  the  purchase  price:  the  minimum  being  a 
tenth  of  increments  of  not  more  than  ten  per  centum,  and  the 
maxinuuu  three  tenths  of  increments  of  two  hundred  and 
ninety  per  centum  and  more. 

About  these  increment  taxes  of  the  British  and  the  Germans 
two  facts  are  to  be  noted:  there  is  no  purpose  to  abolish 
private  property  in  land,  and  there  is  no  appropriation  beyond 
a  portion  of  the  future  increment.  In  view  of  these  facts  one 
may  question  the  justification  for  Mr.  Garrison's  statement 
that  the  Lloyd  George  budget  recognizes  the  principle  of  the 
Single  Tax.  Neither  the  increment  tax  nor  any  other  i^art  of 
that  budget  is  a   recognition   of   the  principle   that  land   should 


SINGLE   TAX  59 

not  be  held  privately,  and  that  is  the  principle  of  the  Single 
Tax  as  advocated  by  Henry  George.  Rather,  as  Professor 
Seligman  has  said,  the  Lloyd  George  budget  is  not  to  be  re- 
garded as  a  triumph  for  the  Single-Taxers.  It  accepts  indeed 
a  small  part  of  the  single-tax  reasoning,  but  it  refuses  to  be 
bound  by  its  narrow   limitations. 

What  the  British  increment  tax  does  recognize  is  the  right- 
fulness of  the  appropriation  of  future  unearned  increments, 
and  both  the  practicability  and  the  expediency  of  the  appropria- 
tion in  a  limited  way,  to  the  end  that  the  evils  of  private 
property  in  land  be  ameliorated.  And  to  bringing  about  the 
use  of  the  taxing  machinery  for  the  accomplishment  of  this 
social  project,   the   Single-Taxers    have   contributed   largely. 

They  have  contributed  largely  also  to  bringing  about  the 
third  of  the  three  things  confounded,  the  fiscal  project  of 
increasing  the  taxation  of  land-values.  They  have  done  this  in 
two  ways:  by  helping  to  overcome  the  prejudices  and  inertia 
that  have  supported  our  all  but  universal  general-property  tax, 
and  by  helping  to  establish  the  principle  on  which  the  increased 
taxation  of  land-values  rests-. 

The  general-property  tax,  of  which  it  has  been  said  that  "a 
cruder  instrumentality  of  taxation  has  rarely  been  devised," 
has  been  under  attack  in  this  country  ever  since  the  notable 
report  made  in  1871  by  David  A.  Wells  as  New  York  Tax 
Commissioner.  During  that  period  there  has  come  to  be  quite 
general  acceptance  by  authorities  in  fiscal  science  of  the  ability 
criterion:  acceptance,  that  is,  of  the  principle  that  taxes  should 
be  levied  proportionately  to  the  ability  to  pay  them.  Tested  by 
this  criterion,  the  general-property  tax  is  condemned  both  as 
to  its  theory  and  as  to  its  administration.  It  is  condemned 
because  its  theory  takes  no  account  of  earning  ability  which 
in  turn  obviously  measures  tax-paying  ability.  Its  theory  takes 
no  account  of  the  industrial  captain's  earning  ability,  but 
takes  full  account  of  the  teamster's  mule.  It  is  condemned 
because  its  administration  "sins  against  the  cardinal  rules  of 
uniformity  and  universality,"  and  because  it  stimulates  the 
iniquities  of  tax-dodging. 

With  the  abandonment  or  modification  of  this  discredited 
general-property  tax,  that  is,  of  its  personalty  and  land-improve- 
ment elements,  there  should  undoubtedly   come,   as   the   Single- 


6o  SELECTED   ARTICLES 

Taxers  urge",  increased  taxation  of  land-values.  Such  taxation 
rests  on  the  principle  that  a  tax  on  the  monopoly  element  of 
the  tax-payer's  income,  that  part  of  his  income  which  has  been 
paid  to  him  for  a  monopoly  appropriated  by  him,  is  to  be  pre- 
ferred to  a  tax  on  the  competitive  element  of  his  income.  A 
tax  on  the  monopoly  element  cannot  be  shifted;  its  incidence 
can  be  reckoned  on;  whereas  the  final  incidence  of  taxes  on 
the  competitive  element,  and  the  total  of  their  injustice,  cannot 
be  reckoned  on.  Furthermore,  a  tax  on  the  monopoly  element 
costs  the  community  less,  in  that  it  does  not  interfere  with  the 
free  action  of  capital  and  the  increase  of  the  general  fund  from 
which  taxes  must  be  paid  and  the  community  maintained. 

In  so  far  as  this  principle  of  taxing  the  monopoly  element 
has  been  accepted,  progress  has  been  made  toward  the  increased 
taxation  of  land-values  because  of  all  monopolies  the  m'ost 
important  is  land.  But  the  railroads,  the  street  railways,  the 
water-works,  the  ability  to  labor  more  effectively  than  wage- 
earners  who  gain  a  bare  subsistence — these  too  are  monopolies. 
And  the  single  tax  toward  which  the  Single-Taxers  have  been 
helping  is  really  a  single  tax  not  on  land  but  on  monopoly,  of 
which,  as  I  have  said,  land  is  the  most  important  part. 

It  is  under  this  third  head,  the  taxation  of  land-values,  not 
under  the  head  either  of  the  abolition  of  private  property  in 
land  or  of  the  appropriation  of  unearned  increment,  that  the 
taxes  cited  by  ]\Ir.  Garrison  as  evidence  of  single-tax  progress 
in  Australia,  Western  Canada,  Pennsylvania,  should  be  assembled. 
They  are  evidence  of  the  progress,  not  of  Henry  George's 
social  project  or  of  Mill's,  but  of  a  movement  toward  better 
fiscal  legislation,  toward  taxation  more  regardful  of  social 
considerations ;  and  in  this  movement  the  Single-Taxers,  so- 
called, — but  in  large  measure  inappropriately  so-called, — are 
helping    importantly. 


AFFIRMATIVE  DISCUSSION 

Arena.  24:645-8.  December,  1900. 

Land  Question  and   Economic  Progress.     Bolton   Hall. 

Q.  ]\Ir.  Hall,  as  one  who  has  made  a  study  of  the  single 
tax,  do  you  believe  that  It  would  prove  an  efficient  remedy  for 
reducing  uninvited  poverty  to  a  minimum? 

A.  Henry  George  says  that,  by  taking  the  rental  value  of 
land  for  the  public,  "the  great  cause  of  the  present  unequal 
distribution  of  wealth  would  be  destroyed,  and  that  one-sided 
competition  would  cease  which  now  deprives  men  who  possess 
nothing  but  power  to  labor  of  the  benefits  of  advancing  civiliza- 
tion, and  forces  wages  to  a  minimum,  no  matter  what  the 
increase  of  wealth.  Labor  [each  man  for  himself,  or  oftener 
in  combinations],  free  to  the  natural  elements  of  production, 
would  no  longer  be  incapable  of  employing  Itself,  and  com- 
petition, acting  as  fully  and  freely  between  employers  as  be- 
tween employed,  would  carry  wages  up  to  what  Is  truly  their 
natural  rate — the  full  value  of  the  produce  of  labor — and  keep 
them  there." 

Q.  What  do  you  think  of  the  influence  that  It  would  have 
ethically  on  society? 

A.  Ethical  progress  must  be  the  progress  of  the  race.  The 
progress  of  the  race  needs  opportunity  for  development,  and  the 
first  requirement  for  this  Is  the  use  of  the  resources  of  Nature. 
Denial  of  this  use  perverts  our  whole  social  system,  and  all 
share  in  the  perversion,  which  makes  fellowship  impossible : 
since  we  are  all  either  receivers  of  rent  of  land — that  is, 
thieves — or  payers  of  rent  of  land — that  is,  abettors  of  thieves. 
Equal  use  of  the  land  would  enable  us  to  live  for  one  another 
instead  of  on  one  another. 

Q.  What  do  you  think  in  regard  to  the  contention  that  the 
taxation  of  land  values  only  would  favor  the  accumulation  of 


62  SELECTED   ARTICLES 

wealth  on  the  part  of  those  who  hold  bonded  securities  and 
prove  oppressive  to  the  land  holders  or  owners? 

A.  We  think  that  justice  would  "favor  the  accumulation 
of  one's  own  wealth,"  if  any  one  cared  to  accumulate  what  he 
could  get  at  will.  "  'Bondholders,'  however,"  says  Louis  F. 
Post,  "are,  in  the  main,  themselves  the  landowners;  for  a  bond 
is  usually  the  first  title  to  some  interest  in  land,  such  as  a  rail- 
road franchise.  It  could  not,  therefore,  both  favor  and  oppress 
them.  Further,  it  could  not  be  oppressive  to  landowners — 
that  is,  to  owners  of  a  special  privilege — to  charge  them  the 
value  of  what  they  get,  even  though  it  would  prevent  their 
accumulation  of   other  people's  wealth." 

Q.    Why  do  you  believe  it  is  a  fundamental  remedy? 

A.  As  is  said  in  "Things  as  They  Are" :  "The  reform,  then, 
of  our  present  land  'system'  is  not  the  end  of  reforms  nor  the 
sum  of  reforms.  It  is,  as  its  great  teacher  has  said,  the  gate- 
way of  reform.  More  than  that,  it  is  the  one  reform  without 
which  all  others  will  be  self-destructive,  because  they  tend  to 
increase  either  population  or  production,  and  thereby  to  in- 
crease rent,  and  so  to  foster  every  form  of  monopoly." 

Q.  ]\Iany  farmers  oppose  the  single  tax,  as  they  think  it 
would  be  oppressive  to  them.  In  other  words,  they  hold  that 
their  land  would  be  more  heavily  taxed  than  all  these  taxes 
put  together  amount  to  at  present,  while  the  holder  of  bank 
stock  and  other  securities  would  be  practically  exempt  from 
taxation.     Do  you  think  their  position   is   well  taken? 

A.  When  it  is  remembered  that  some  land  in  cities  is  worth 
twelve  millions  of  dollars  an  acre;  that  a  small  building  lot  in 
the  business  center  of  even  a  small  village  is  worth  more  than 
a  whole  field  of  the  best  farming  land  in  the  neighborhood; 
that  a  few  acres  of  coal  or  iron  is  worth  more  than  great  groups 
of  farms;  that  the  right  of  way  of  a  railroad  company  through 
a  thickly-settled  district  or  between  important  points  is  worth 
more  than  its  rolling  stock;  that  the  value  of  workingmen's 
cottages  in  the  suburbs  is  trifling  in  comparison  with  the  value 
of  city  residence  sites— the  absurdity,  if  not  the  dishonesty,  of 
the  plea  that  the  single  tax  would  discriminate  against  farmers 
and  small  liome  owners  and  in  favor  of  the  rich  is  evident. 
The  l)ad  faith  of  this  plea  is  emphasized  when  we  consider 
that    under    existing    systems    of    taxation    the    farmer   and    the 


SINGLE   TAX  63 

poor  home  owner  are  compelled  to  pay  in  taxes  on  improve- 
ments, food,  clothing,  and  other  objects  of  consumption  much 
more  than  the  full  annual  value  of  their  bare  land. 


World's  Work.  21:13795-6.  December,  1910. 

Way  Toward  The  Model  City.     Frederic  C.  Howe. 

Germany  has  set  the  pace  in  city-building,  as  in  many  other 
reforms.  It  is  the  only  country  in  the  world  that  has  treated 
the  subject  as  a  science.  Germany  designs  its  cities  as  the 
World's  Fairs  at  Chicago  or  St.  Louis  were  designed  by  land- 
scape artists  and  architects.  They  are  planned  from  the  bottom 
up.  And  the  thing  in  most  striking  contrast  with  our  own  cities 
is  the  power  which  the  German  municipality  enjoys  over  the 
land  within  its  limits.  During  the  summer  of  1909  I  visited 
a  number  of  the  leading  cities  of  Germany  and  found  that 
many  officials  insisted,  with  no  feeling  of  apology,  that  the 
city  must  own  all  of  the  land  within  its  limits.  Only  by  owner- 
ship, it  was  said,  could  the  housing  problem  be  solved ;  only  in 
this  way  could  parks,  streets,  boulevards,  and  planning  projects 
be  carried  out  and  industrial  development  be  made  to  harmonize 
with  the  ideals  of  what  these  experts  felt  that  the  modern  city 
could  be  made.  In  pursuance  of  this  policy  the  German  city 
approaches  the  land  question  in  three  ways,  all  of  which  are 
novel.  First,  by  ownership.  A  surprising  number  of  cities  own 
not  only  parks  and  open  spaces,  but  great  wooded  estates  outside 
of  the  city,  which  are  used  for  pleasure  as  well  as  for  profit. 
They  are  worked  as  forest  preserves.  A  large  part  of  the 
building  area  within  the  city  is  owned  as  well.  Some  idea  of 
the  holdings  of  the  cities  can  be  got  from  the  accompanying 
diagrams. 

Some  cities  are  also  active  speculators  in  city  and  suburban 
land.  They  make  a  business  of  buying  and  selling  for  profit. 
DiJsseldorf,  for  instance,  a  city  of  300,000,  has  set  side  a  fund  of 
$5,500,000   for   the   purpose   of   land-speculation. 

The  city  controls  the  land-owner  and  land-speculator  in 
yet  another  way.  Only  a  part  of  the  site  may  be  built  upon. 
The  percentage  differs  according  to  the  section  of  the  city. 
In  the  business  centres  the  owner  may  use  as  much  as  60  per 


64*  SELECTED   ARTICLES 

cent. ;  in  the  outskirts,  only  35  per  cent.  Buildings,  too,  are 
limited  in  height,  the  usual  provision  being  that  they  shall  not 
exceed  the  width  of  the  street.  Similar  restraints  are  imposed 
on  factory  owners,  who  are  confined  to  certain  sections  of  the 
outlying  territory,  usually  to  that  side  of  the  town  which  is 
away  from  the  prevaiHng  winds.  Thus  the  land-speculator, 
owner,  builder,  and  manufacturer  are  compelled  to  use  their 
land  so  that  it  will  not  be  offensive  to  neighboring  owners  or 
in  any  way  prejudicial  to  the  harmonious  planning  of  the  city 
as  laid  out  by  the  city  council.  The  city  and  the  comfort  of 
its  citizens  are  the  primary  considerations. 

The   German   Tax  on   Land-Values 

The  third  contribution  which  Germany  has  made  to  the 
subject  of  city  planning — and  a  contribution  which  has  swept 
over  Europe  into  Great  Britain,  Austria,  Belgium,  and  Switzer- 
land— is  a  system  of  local  taxation  which  discourages  the 
land-speculator  and  gives  to  the  city  a  new  and  constantly- 
increasing  revenue.  Autocratic  Germany,  ruled  as  it  is  by  the 
reactionary  three-class  system  of  voting,  which  places  the  cities 
in  the  hands  of  the  large  tax-payers,  is  the  last  country  in  the 
world  where  we  should  expect  the  teachings  of  Henry  George 
to  take  root  and  be  applied.  And  the  Germans  deny  that  they 
have  adopted  the. single-tax  idea  in  taxing  the  "unearned  incre- 
ment," just  as  they  deny  that  there  is  anything  socialistic  in 
the  state-ownership  of  mines  and  railroads  or  the  city-ownership 
of  docks,  street  railways,  gas,  and  many  kinds  of  enterprises 
which  in  this  country  are  in  private  hands.  Still  Germany  does 
tax  the  "unearned  increment"  of  land. 

"Of  course  we  do  not  like  to  pay  any  more  taxes,"  a 
prominent  manufacturer  in  one  of  the  German  cities  said  to 
me;  "but  we  cannot  very  well  object  to  the  taxation  of  increas- 
ing land-values,  for  of  course  the  city  creates  them;  they  would 
not  exist  were  it  not  for  the  people  and  the  industry;  they  do 
not  really  belong  to  the  owners,  and  in  all  justice  the  city 
ought  to  take  at  least  a  part  of  what  it  has  created."  Under 
the  new  tax  the  land  is  appraised  every  fifteen  or  twenty  years, 
and  any  increase  in  value  is  subject  to  a  tax.  In  case  of  sale  the 
profits  realized  are  subject  to  the  same  sort  of  taxation.  The  seller 
is   compelled   to   give  up   a   portion   of   the   gains    which   have 


SINGLE   TAX  65 

been  created  by  the  growth  of  the  city,  the  opening  of  new 
territory,  the  development  of  transit  to  the  suburbs,  or  any  of 
the  thousand  influences  which  add  to  the  value  of  city  land. 
Unimproved  land  is  taxed  more  heavily  than  that  which  is 
improved,  while  the  percentage  taken  by  the  city  increases  with 
the  profit  realized  by  the  owner.  It  ranges  from  i  to  33  per 
cent,  of  the  net  profits. 

This  experiment,  which  had  its  beginning  in  Frankfort  less 
than  ten  years  ago,  has  spread  to  nearly  all  of  the  cities  of 
Germany.  It  inspired  the  budget  of  Great  Britain  in  1909,  which 
the  great  land-owners  in  the  House  of  Lords  rejected.  And 
it  is  of  especial  interest  to  America,  where  every  innovation  in 
taxation  is  viewed  with  suspicion,  because  the  German  city  is 
administered  by  experts,  by  men  trained  in  the  universities  and 
in  the  technical  schools  and  by  years  of  experience  in  city 
matters ;  and  the  officials  are  chosen,  not  by  a  democratic  ballot, 
but  by  the  business  men  and  the  large  tax-payers  who  (under 
the  Prussian  three-class  system  of  voting)  are  absolutely  in 
control  of  the  politics  of  the  cities.  Moreover,  we  have  the 
best  sort  of  machinery  for  applying  the  German  system,  for  we 
already  levy  a  large  part  of  our  taxes  upon  land;  and,  as  we 
revalue  our  real  estate  periodically  (often  every  year),  we  can 
easily  ascertain  the  increase   in  values   with   accuracy. 

Land-Taxation   and   City-Planning. 

What  has  the  taxation  of  land-values  to  do  with  city- 
planning  and  the  housing  question?  How  will  it  promote  the 
city  beautiful  or  aid  in  the  realization  of  the  ambitious  plans 
which  our  cities  are  beginning  to  project?  Has  municipal  tax- 
ation anything  to  do  with  the  price  of  land?  Can  taxation  be 
adjusted  to  promote  a  social  policy  as  well  as  defray  the 
increasing  needs   of  the  community? 

I  spent  some  years  as  secretary  of  the  Tax  Conference  of 
Pennsylvania  and  recently  served  on  the  Board  of  Real-Estate 
Appraisers  of  the  city  of  Cleveland,  Ohio.  And  I  have  become 
convinced  that  the  taxation  of  land-values  is  not  only  just  but 
it  is  the  easiest  and  most  fundamental  of  all  means  for  the  cur^ 
of  the  housing  question  and  the  proper  building  and  planning 
of  cities.  By  the  taxation  of  land-values  I  mean  the  taxation 
of  the  site  or  speculative  value  in  land,  and  not  land  itself.     In 


66  SELECTED   ARTICLES 

other  words,  that  all  of  the  local  revenues  should  be  taken  from 
ground  or  land  rents,  just  as  is  now  commonly  done  by  private 
individuals  under  the  ground-rent  system  which  prevails  uni- 
versally in  Baltimore  and  in  the  business  centres  of  our  large 
cities.  This  would  be  brought  about  by  a  very  simple  law 
which  exempted  houses,  buildings,  improvements  and  personal 
property  from  taxation.  Then  local  taxes  would  fall  auto- 
matically on  the  land  alone. 

There  is  no  difficulty  about  ascertaining  the  real  value  of 
land,  as  was  for  a  long  time  assumed.  As  a  matter  of  fact,  it 
is  the  easiest  thing  in  the  world  to  do.  New  York  City  has 
since  1903  separated  its  valuations  of  land  and  improvements. 
Boston  has  done  the  same  thing  for  a  much  longer  period.  The 
tax  board  of  Cleveland  perfected  an  organization,  trained  its 
experts,  and  completed  the  assessments  of  all  land  as  well 
as  all  the  buildings  within  the  city  in  six  months'  time;  and 
did  it  more  justly,  more  easily,  and  more  economically  than  I 
thought  possible.  And  the  land  valuation  was  made  with  the 
minimum  of  complaint  and  protest.  It  met  with  almost 
universal  approval. 

Is  this  suggestion  just?  Is  it  fair  to  tax  only  one  kind  of 
property — land?  I  fancy  the  apparent  injustice  of  the  proposal 
delays  this  reform  more  than  any  other  cause.  And  yet  the 
taxation  of  land-values  alone  is  the  most  just  of  all  systems  of 
taxation.  It  is  merely  taking  that  which  has  been  created  by 
society.  The  4,000  million  dollars  of  land-values  in  New  York 
City,  equal  to  two-thirds  of  the  cost  of  the  Civil  War,  is  due 
to  the  growth  and  development  of  the  city.  It  was  not  created 
by  the  thrift,  enterprise,  or  ability  of  the  owners,  or  by  any 
service  which  they  render  to  society.  So  far  as  they  are 
concerned,  the  colossal  value  is  an  unearned  increment.  It  is 
due  wholly  to  the  growth  of  population  and  the  progress  of 
society.  And  the  tax  suggested  involves  merely  the  taking  by 
the  community  of  that  which  the  community  has  created. 

No    Other   City   Revenue   Required 

(      Is  such  a  tax  adequate?     Can  we  abandon  all  other   forms 

)  of  revenue?    As  a  matter  of  fact  the  ground-rents  (not  including 

\  building-rents)    of    our    cities    are    colossal.      They    far    exceed 

1  every  possible  need  of  the  most  extravagant  community.     They 


SINGLE   TAX  67 

would  more  than  pay  all  of  the  local  needs.  In  New  York 
City,  the  real  estate  is  valued  every  year.  During  the  four 
years  from  1904  to  1908  the  value  of  the  land,  exclusive  of 
improvements,  increased  from  $3,057,161,290  to  $3,843,165,597. 
In  four  years'  time  the  speculative  increase  alone  amounted  to 
$786,004,307,  or  nearly  $200,000,000  a  year.  The  increase  is 
fairly  normal  from  year  to  year  and  reflects  the  birth-rate  and 
the  growth  of  population.  During  these  four  years  the  total 
expenditures  of  the  city  amounted  to  about  $160,000,000  a  year, 
or  $40,000,000  less  than  the  speculative  increase  in  the  value  of 
the  land. 

With  perfect  safety  New  York  could  declare:  "We  will  levy 
no  taxes  on  real  estate  or  personal  property  in  191 1;  we  will 
abandon  all  revenues  from  licenses,  from  the  excise  taxes  and 
all  other  form  of  revenue,  and  will  content  ourselves  with  the 
increase  in  value  which  takes  place  in  the  land.  From  this 
source,  which  is  our  creation,  we  will  run  the  city  and  relieve 
all  property  and  business  from  taxation."  Under  such  a  pro- 
posal, which  would  take  not  a  penny  of  anything  which  exists 
to-day,  the  city  could  be  operated  and  in  addition  enjoy  a  surplus 
which  would  build  a  subway  every  year  equal  to  the  first  one 
constructed  from  the  Battery  to  Harlem,  and  at  no  cost  to  the 
people  of  the  city.  The  German  statisticians  estimate  that  land- 
values  in  a  growing  city  increase  at  the  rate  of  about  4  per 
cent,  a  year,  which  would  be  somewhat  less  than  the  increase 
above  indicated. 

New  York  City  is  not  exceptional.  Similar  investigations 
and  assessments  in  Boston,  Washington,  San  Francisco,  and  else- 
where show  that  the  speculative  increase  in  the  value  of  the 
land  amounts  to  more  than  the  annual  expenditures  of  these 
cities. 

But  even  were  land-values  stationary,  the  present  ground- 
rents  far  exceed  the  city's  needs.  In  New  York  the  land-rent 
(not  including  building-rents)  enjoyed  by  ground  landlords 
amounts  to  approximately  $200,000,000  a  year.  This  is  arrived 
at  by  assuming  that  the  total  assessed  value  of  $3,843, 165, 597  has 
this  value  by  reason  of  a  fair  return  in  interest,  which,  figured 
at  5  per  cent,  amounts  to  $192,158,279.  This,  too,  is  after  the 
city  has  taken  in  taxation  at  least  $50,000,000  from  these  total 
rentals ;  so  that  the  total  fund  available  for  taxation  is  approxi- 


68  SELECTED   ARTICLES 

mately  $250,000,000,  or  nearly  $100,000,000  more  than  the  present 
local  budget. 

Were  the  city  to  abandon  all  other  forms  and  sources  of 
revenue  and  tax  only  land-values,  the  distribution  of  ground- 
rent  would  be  as  follows:  Total  ground-  or  land-rent  of  city 
(including  taxes),  $250,000,000.  Total  taxes  taken  from  rent, 
$160,000,000.     Total  income  left  to  owners,  $90,000,000. 

Let  us  see  what  would  follow  from  exempting  houses  and 
buildings  from  taxation  and  an  increase  in  the  rate  on  land. 
How  would  it  afifect  the  building  of  cities  and  the  housing  of 
the  people?  What  are  the  social  and  industrial  consequences 
of  such  a  taxing  policy? 

Penalising  Industrious  Ozvncrs 

France  levies  a  tax  on  windows.  As  one  travels  through 
French  villages  he  sees  the  windows  of  the  peasant  sealed  up 
with  cement.  The  people  live  in  darkness  in  order  to  escape  a 
tax.  During  the  eighteenth  century  a  chimney-tax  was  imposed 
in  Ireland.  The  Irish  tenant  met  the  tax  by  tearing  down  his 
chimneys.  Fle  preferred  to  live  in  the  dirt  and  smoke  of  a 
chimney-less  cabin  rather  than  be  taxed.  The  tax  destroyed 
the  thing  taxed,  just  as  it  always  tends  to  do. 

Economists  all  protest  against  these  medieval  taxes.  They 
smile  at  the  short-sightedness  of  the  French  statesmen.  Are  we 
in  America  any  wiser  than  the  French  in  our  methods  of  local 
taxation?  They  are  probably  just  as  honest  in  their  approval 
of  the  window-taxes  as  we  are  in  our  admiration  of  the  tax 
on  houses  and  improvements  which  discourages,  fines,  and 
punishes  him  who  builds  a  house,  or  improves  his  estate,  or 
erects  a  model  tenement,  or  conforms  to  the  sanitary  regulations 
of  our  cities.  For  do  we  not  tax  the  man  who  l)uilds  a  beautiful 
building  more  heavily  than  him  who  builds  an  ugly  one?  Do  we 
not  punish  with  a  fine  him  who  erects  a  model  tenement,  and 
thereby  encourage  the  lazy  owner  who  is  content  with  his  slum? 
Do  we  not  penalize  the  farmer  or  the  workman  who  paints  his 
house,  or  adorns  his  dwelling  with  things  of  art  and  beauty,  or 
employs  an  architect  instead  of  a  contractor?  Do  not  our  laws 
in  effect  applaud  the  man  who  leaves  his  property  and  his  land 
as  disreputable  as  possible?  Do  we  not  say  to  the  farmer: 
if  you  put  your  land  in  market  gardening  we  will  assess  you 


SINGLE   TAX  69 

$500  an  acre,  but  if  you  let  it  grow  up  in  weeds  we  will  assess 
you  but  $50  an  acre?  At  least  that  is  the  way  it  appears  to  every 
tax-payer,  be  he  great  or  small.  It  consciously  or  unconsciously 
affects  his  mind  in  every  contemplated  improvement.  These  are 
the  arguments  that  are  advanced  to  village  and  township-assess- 
ors by  farmers  and  home-owners  who  resent  instinctively  the 
injustice  of  being  taxed  because  they  do  a  thing  for  which  they 
know  they  should  be  applauded.  Further  than  this,  we  encourage 
men  to  hold  land  idle.  We  discourage  improvements.  This  is 
clearly  the  result  of  taxing  houses,  buildings,  crops,  machinery, 
and  personal  property. 

Build  a  Fire  Behind  the  Speculator 

Now  let  us  see  what  would  happen  to  the  idle  land-speculator, 
to  the  man  who  does  nothing  with  his  land  in  the  city  or  in  the 
suburbs,  as  well  as  to  the  energetic  farmer  who  wants  to  own 
as  beautiful  a  house  as  possible,  to  the  man  who  erects  a  fine 
apartment  or  a  model  tenement,  to  the  man  who  instals  new 
plumbing  and  complies  with  all  the  tenement  regulations — if  we 
were  to  reverse  our  present  system  and  repeal  all  taxes  on  im- 
provements and  houses.  We  should  then  give  legal  encourage- 
ment to  the  things  that  we  most  want :  to  buildings,  to  houses  and 
factories,  to  model  tenements,  to  truck  gardening,  to  art,  archi- 
tecture, and  beauty.  We  should  encourage  industry  and  cheapen 
the  prices  of  things  in  the  stores  as  well  as  the  rents  in  the  cities. 
We  should  stamp  with  public  approval  the  man  who  contributes 
to  the  well-being  of  humanity,  rather  than  penalize  him  for  his 
industry.  We  should  encourage  the  man  who  produces  wealth. 
These  surely  are  the  results  which  would  follow  from  ceasing 
to  tax  the  things  that  we  most  want,  just  as  the  taxation  of 
windows  and  chimneys  led  to  their  disuse. 

To  Bring  Idle  Land  to  Market 
But  I  have  not  yet  touched  on  the  greatest  of  all  benefits 
which  would  follow  city-planning,  the  building  of  cities,  and 
the  housing  question — and  that  benefit  is  the  cheapening  of  land. 
It  would  do  this  in  two  ways.  First,  the  taxation  of  land  forces 
it  into  use;  it  brings  it  to  the  market.  And  this  is  an  unmixed 
blessing.  We  should  feel  that  it  is  a  crime  for  men  to  produce 
bread  or  clothes  or  shoes  and  hold  them  merely  for  speculation. 


70  SELECTED   ARTICLES 

And  yet  the  speculative  holding  of  land  is  even  more  costly  to 
society  than  the  withholding  of  these  necessities  of  life.  For, 
given  the  land,  we  can  produce  wealth;  and  the  forcing  of  idle 
land  into  the  market  would  bring  down  its  price.  This  is  the 
inevitable  result  of  increasing  the  supply  of  any  commodity. 
It  has  been  estimated  that  at  least  half  of  the  land  in  every  large 
city  is  held  out  of  use  all  the  time  by  speculators. 

The  second  influence  that  cheapens  land-values  is  the  re- 
duction of  the  rent  or  income  which  it  produces.  For  a  tax 
on  land-values  is  paid  by  the  landlord ;  it  is  taken  from  ground- 
rent.  The  landlord  cannot  shift  it  on  to  some  one  else  as  he  can 
a  tax  on  houses  or  on  any  other  wealth  produced  under  competi- 
tion. I  need  hardly  verify  this  from  authorities,  yet  an  appreci- 
ation of  this  fact  is  so  fundamental  to  an  understanding  of  the 
effects  which  would  follow,  that  I  quote  two  leading  economists 
on  the  subject.  Ricardo,  the  great  English  political  economist, 
says : 

A  tax  on  rent  would  affect  rent  only;  it  would  fall  wholly  on  land- 
lords, and  could  not  be  shifted  to  any  class  of  consumers.  The  landlord 
could  not  raise  rent. 

John  Stuart  Mill  confirms  this  statement.     He  says: 

A  tax  on  rent  falls  wholly  on  the  landlord.  There  are  no  means  by 
which  he  can  shift  the  burden  upon  any  one  else.  A  tax  on  rent,  there- 
fore, has  no  effect  other  than  the  obvious  one.  It  merely  takes  so  much 
from  the  landlord  and  transfers  it  to  the  state. 

Let  US  make  the  statement  concrete.  If  a  man  is  getting  $50 
a  year  ground-rent  from  a  piece  of  land,  the  land  is  worth  the 
capitalized  value  of  the  ground-rent,  or  $1,000.  Now  if  the 
state  increases  the  tax  and  takes  $20  of  this  ground-rent,  the 
landlord's  income  will  fall  to  $30,  which  (capitalized  as  before) 
makes  the  land  worth  $600.  If  the  tax  is  still  further  increased 
to  4  per  cent.,  the  capital  value  of  the  land  is  reduced  to  $200; 
and  if  the  tax  is  increased  to  5  per  cent.,  the  capital  value  of  the 
land  disappears  altogether,  for  all  of  its  earnings  have  been  taken 
in  taxes.  In  other  words,  ground-rent  is  the  income  that  is 
left  after  taxes  are  deducted.  If  taxes  are  increased,  rent  is 
decreased.  If  taxes  are  diminished,  rent  is  increased.  The  land- 
lord and  the  state  are  really  partners  in  the  ownership  of  the 
land. 


SINGLE   TAX  71 

The  Land-Ozvner  Pays  the  Tax 

It  may  be  said  that  the  landlord  will  meet  any  increase  in 
taxes  by  an  increase  in  rent,  just  as  the  taxes  on  sugar,  clothes, 
or  any  other  commodity  are  shifted  to  the  final  consumer.  But 
this  he  cannot  do,  as  experience  has  demonstrated.  The  land- 
tax  remains  where  it  is  originally  placed.  Certainly,  so  far  as 
vacant  land  is  concerned,  there  is  no  one  but  the  landlord  to 
pay  the  taxes.  He  could  only  shift  the  tax  by  leasing  the  land 
to  some  one  to  use;  and  if  all  the  land  were  thus  brought  into 
use,  the  competition  of  sellers  and  users  would  be  such  that 
this  of  itself  would  bring  down  the  price  of  land,  just'  as  it  does 
the  price  of  everything  else. 

It  is  this  cheapening  of  land-values  that  is  so  important  in 
the  solution  of  the  housing  question  or  the  planning  of  cities. 
This,  with  the  stimulus  to  use  the  land,  w^ould  bring  about  a 
revolution  in  city-building  that  would  surpass  all  of  the  regu- 
latory measures  and  all  of  the  health  and  sanitary  inspection  that 
can  be  devised.  There  is  no  reason  why  the  building  of  homes 
should  not  inspire  the  same  sort  of  ingenuity,  skill,  and  scientific 
enthusiasm  that  is  awakened  by  the  building  of  automobiles. 
And  such  skill  would  be  awakened  were  the  land-owner  subjected 
to  the  same  sort  of  pressure  that  drives  the  manufacturer  and 
the  business  man.  This  the  taxation  of  land  will  bring  about. 
And  if  the  owner  of  land  were  compelled  to  build  houses,  and 
were  those  houses  relieved  from  taxation,  there  would  arise  a 
competition  for  tenants  that  would  of  itself  solve  the  housing 
problem.  Then  owners  would  introduce  beauty  and  the  latest 
sanitary  devices  from  necessity  rather  than  from  legal  compul- 
sion. The  builders  would  be  moved  by  self-interest  to  devise 
attractive  homes  rather  than  warehouses  for  human  beings. 
Home-building  is  a  backward  industry.  It  has  not  begun  to 
keep  pace  with  other  things.  In  all  essentials  we  build  houses 
much  as  we  did  fifty  years  ago.  The  reason  is  that  population  is 
always  outrunning  the  supply  of  houses.  Almost  anything  can 
be  rented  in  our  cities,  no  matter  ho.w  cheap,  tawdry,  or  un- 
homelike  it  may  be. 

This  I  think  is  verified  by  New  York  City.  No  city  in  the 
world  approaches  the  American  metropolis  in  the  convenience, 
attractiveness,   and   splendor   of    the   office-buildings  and  apart- 


72  SELECTED   ARTICLES 

ment-houses,  or  the  wonderful  ingenuity  of  the  hotels.  Buildings 
begin  to  be  antiquated  almost  as  soon  as  they  are  completed. 
Twenty  years'  time  sees  a  great  reduction  in  their  rent,  or  brings 
about  their  demolition.  This  is  not  due  to  the  high  price  of  land. 
If  that  were  the  cause,  London  would  surpass  New  York  in 
splendor,  and  Chicago  would  vie  with  it.  It  is  due  to  the  honest 
valuation  of  land  and  the  high  tax  imposed  upon  it  And  if  we 
carried  the  tax  still  higher,  if  we  doubled  the  existing  rate, 
landlords  would  be  compelled  to  enter  a  race  for  tenants  just  as 
automobile  manufacturers  now  race  for  purchasers.  House  and 
apartment  building  and  the  housing  question  would  be  subject 
to  the  same  laws  of  competition  that  govern  other  businesses. 

This  cheapening  of  land,  which  can  be  carried  to  any  extent 
by  taxation,  would  make  city  building  easy.  It  would  enable 
parks,  boulevards,  and  docks  to  be  acquired  and  developed;  it 
would  permit  the  location  of  public  buildings  and  the  opening 
up  of  open  spaces  and  playgrounds.  Public  buildings  could  be 
grouped  so  as  to  secure  the  maximum  of  architectural  effect, 
while  suburbs  could  be  laid  out  in  a  generous  and  beautiful 
manner.  There  is  no  reason  why  the  cities  of  the  future  should 
not  be  garden  cities — just  such  garden  cities  as  Washington, 
Diisseldorf,  Frankfort,  and  a  dozen  cities  in  Europe — just  such 
garden  cities  as  have  been  planned  by  philanthropists  and  busi- 
ness men.    The  only  obstacle  is  the  prohibitive  price  of  city  land. 

The  great  advantage  of  the  reform  suggested  lies  in  the  fact 
that  it  is  automatic.  An  ounce  of  taxation  will  do  more  to  clean 
up  a  slum  than  a  score  of  sanitary  policemen.  Self-interest  is 
the  moving  force  in  all  other  business.  Wh}^  should  it  not  be 
made  operative  on  the  land-owner?  He  has  no  vested  right  to 
be  made  rich  by  the  growth  of  the  community.  Nor  has  he  any 
vested  right  to  hold  land  out  of  use,  to  block  the  orderly  de- 
velopment of  the  city,  and  at  the  same  time  make  the  price  of 
all  other  land  so  high  that  the  rents  of  the  whole  community 
are  forced  up  in  consequence.  For  that  is  what  happens.  It  is 
the  withholding  of  land  from  use  that  explains  the  high  rents  of 
our  cities  ;  it  is  this  that  lies  at  the  root  of  the  housing  problem ; 
it  is  this  that  is  responsible  for  the  high  cost  of  living — for  only 
a  fraction  (and  a  very  small  fraction)  of  the  land  in  America 
is  used.  And  yet  it  is  all  owned.  And  I  have  never  met  a  land- 
owner who  did  not  feel  that  his  land  was  worth  from  50  to  100 


SINGLE   TAX  n 

per  cent  more  than  it  would  really  produce.  Try  to  buy  farm- 
ing land  within  twenty  miles  of  any  large  city  and  see  the  prices 
which  are  asked.  Study  the  metropolitan  values  asked  for  busi- 
ness sites  in  the  Western  cities. 

The  cities  of  Australasia  as  well  as  those  of  northwest  Can- 
ada have  already  recognized  the  justice  as  well  as  the  expediency 
of  exempting  improvements  from  local  taxation.  Nearly  a 
hundred  communities  in  Australasia  have  abolished  the  house 
and  improvement-tax,  while  within  the  last  few  years  quite  a 
number  of  the  new  cities  in  western  Canada  have,  by  municipal 
action,  done  the  same  thing.  The  inspiration  of  this  action  was 
in  each  case  the  same.  It  was  the  desire  to  check  land-specula- 
tion and  to  encourage  building.  And  the  testimony  of  all  these 
experiments  is  to  the  same  effect.  Officials,  business  men,  and 
ordinary  citizens  unite  in  admitting  that  the  burden  of  taxation 
has  tended  to  the  breaking-up  of  great  estates ;  it  has  led  to  an 
encouragement  to  building  that  was  unprecedented,  and  has  stim- 
ulated not  only  the  building  of  homes  but  their  ownership  as 
well. 

Congressional  Record.     48:13196.  August  29,  1912. 

Mr.  Bulkley  said: 

Mr.  Speaker :  In  view  of  the  general  interest  now  being  man- 
ifested in  the  subject  of  taxation  throughout  the  country,  I  desire 
to  take  advantage  of  the  privilege  of  extending  my  remarks 
by  submitting  for  the  Record  an  extract  from  a  speech  by  a 
former  Member  of  this  House,  the  late  Hon.  Tom  L.  Johnson, 
at  a  gathering  of  farmers  near  Akron,  Ohio,  August  29,  1905, 
when  he  was  the  Democratic  candidate  for  governor  of  Ohio. 

After  speaking  on  the  issues  in  state  and  county  for  some 
half  hour  Mr.  Johnson,  as  was  his  custom,  called  for  questions. 
A  venerable  gentleman,  with  long  white  whiskers,  arose  and 
said:  "Mr.  Speaker,  I  have  a  suspicion  from  what  I  have  read 
in  the  papers,  that  you  desire  to  place  all  taxes  on  land.  Is  this 
correct?"  Some  one  else  in  the  audience  then  called  out:  "Tell 
us  about  the  Single  Tax."  Replying  to  the  elderly  man  ^Ir.  John- 
son said:  "]Most  emphatically,  no."  He  paused  for  a  moment, 
then  continuing,  said: 

"But  if  you  mean  that  I  have  a  desire  to  place  all  taxes  on 


74  SELECTED   ARTICLES 

land  values,  I  answer  most  decidedly,  'Yes.'  If  you  want  to  hear 
about  the  Single  Tax,  I  will  stay  with  you  and  let  my  tent  meet- 
ing in  the  city  w^ait,  while  I  say  that  if  it  were  not  for  this  idea, 
called  Single  Tax,  I  w^ould  not  be  here  to-night.  This  is  the  rea- 
son that  I  am  what  I  am  and  making  the  fight  which  we  are 
now^  in.  A  tax  on  land  would  be  an  unjust  and  iniquitous  system, 
but  a  tax  on  land  values  would  be  the  best  and  fairest  system 
that  the  world  has  ever  known.  Laws  which  would  bring  about 
the  taxation  of  land  values  would  be  of  more  service  to  hu- 
manity than  any  legislation  ever  yet  enacted.  Farmers  are  large 
ow^ners  of  land,  but  not  of  land  values.  We  have  land  in  our 
city  that  sells  at  the  rate  of  $5,000,000  per  acre.  Have  any  of 
your  farmers  lands  as  valuable  as  that?  In  New  York  city  there 
is  land  that  sells  for  $15,000,000  per  acre.  Is  there  any  land  in 
this  neighborhood  at  that  price? 

"To  answer  my  friend's  question  I  will  relate  a  little  talk 
I  had  one  day  with  Congressman  Pierson,  of  Tuscarawas  County, 
when  we  were  in  Washington  together.  Pierson  was  a  farmer 
and  said  to  me  one  day:  Tom  I  can  not  go  your  Single  Tax; 
it  would  be  a  hardship  on  the  farmers,  and  they  already  have 
more  than  their  share  of  the  burden  of  taxation.' 

"I  said:  'Look  here,  Pierson,  if  I  thought  the  Single  Tax 
would  increase  the  farmers'  burden  I  would  not  stand  for  it  for 
one  minute.  In  fact,  if  I  did  not  know  it  w^ould  be  the  greatest 
blessing  to  the  farmers  and  to  the  workingmen  in  the  city  as 
well,  I  never  would  advocate  it  again.  I  can  show  you  that 
the  Single  Tax  will  lighten  the  farmers'  burden  as  compared  with 
the  present  method.  Let  me  ask  you  some  questions  to  see 
if  we  can  get  at  the  facts  in  the  matter.  How  much,  ]\Ir.  Pierson, 
of  the  present  tax  burden  do  you  think  the  farmers  bear?' 
'Well,'  he  answered,  'the  farmers  constitute  over  half  the  pop- 
ulation of  the  United  States,  and  I  should  say  that  they  pay 
at  least  60  per  cent  of  all  taxes.'  'Very  well,  let's  call  it  50  per 
cent  to  be  safe.'  'No,  no,'  said  Pierson,  'that's  too  low.  They 
pay  more  than  60  per  cent,  rather  than  less.'  'All  right;  but  to 
be  safe,  let's  call  it  50  per  cent.' 

"  'Now,  Mr.  Pierson,  I  want  you  to  tell  me  how  much  of  the 
value  of  land  the  farmers  have  in  the  United  States?  Please 
take  into  consideration  all  the  valuable  coal  lands,  the  iron,  silver, 
gold,  copper,  and  other  valuable  mines;  the  water  privileges,  the 


SINGLE   TAX  75 

railroads,  and  their  rights  of  way  and  terminals,  including  street 
railroads,  telephones,  and  telegraphs,  for  these  are  built  on  the 
most  valuable  lands;  all  the  gas  and  electric  lighting  rights  of 
way  built  on  land  of  great  value ;  all  the  city  lots,  some  of  which 
are  worth  more  than  a  whole  county  of  farming  land.  I  want 
you  to  take  all  these  into  consideration  and  then  tell  me  how 
much  of  these  values  in  the  United  States  the  farmers  have.' 

"Air.  Pierson  replied,  'Well,  I  should  say  less  than  5  per 
cent.'  I  said,  'Call  it  10  per  cent  to  be  safe.'  'Oh,  no,  no ;  that's 
entirely  too  high;  that's  double.'  'Well,  we  will  call  it  10  per 
cent,  anyway.  Now,  don't  you  see  that  if  the  farmers  are  pay- 
ing 50  per  cent,  that  if  all  the  taxes  were  raised  by  a  Single  Tax 
on  land  values  the  farmers,  since  they  have  but  10  per  cent  of 
these  values— you  say  5  per  cent— would  pay  less;  that  their 
taxes  would  be  reduced  five  times?  That  instead  of  paying 
one-half,  as  now,  they  would  under  that  plan  pay  but  one-tenth  ?' 

'"I  declare,  Tom,  I  never  looked  at  it  in  that  Hght,  and  1 
guess  you  have  got  me.' 

"So,  I  say  to  the  farmers  here  tonight,  that  this  Single  Tax, 
of  which  I  am  proud  to  be  an  advocate,  would  be  to  the  over- 
burdened farmers  and  workingmen  the  greatest  boon,  the  great- 
est blessing,  the  greatest  godsend  that  any  country  ever  knew. 
I  wish  you  good  night." 


Arena.    10:52-8.    June,    1894. 

Single  Tax  in  Actual  Application.     Hamlin  Garland. 

A  theory  that  is  morally  and  logically  right  will  work  in 
practice,  but  at  the  same  time  a  practical  example  of  the  working 
out  of  the  principle  involved  is  valuable.  The  single-tax  men 
seem  to  have  such  an  exemplification  in  the  case  of  New  Zealand, 
where  an  effort  has  been  put  forth  to  discourage  land  speculation 
by  means  of  a  land  tax.  It  is  not  precisely  the  Single  Tax— prob- 
ably the  single-tax  men  will  consider  that  its  greatest  fault- 
but  its  work  of  checking  land  speculation  and  breaking  up  the 
large  estates  is  admitted. 

I  have  before  me  the  advance  sheets  of  the  Consular  Reports 
from  the  Bureau  of  Statistics  in  Washington,  wherein  Mr.  John 
D.  Connolly,  consul  to  New  Zealand,  gives  his  report.     It  is  so 


76  SELECTED   ARTICLES 

valuable  just  now  when  the  question  of  the  Single  Tax  is  being 
strongly  advocated  that  I  quote  quite  fully  from  it.  Mr.  Con- 
nolly begins  by  saying : — 

Land  Taxation  in  Nezu  Zealand 

In  the  matter  of  taxation  laws  New  Zealand  excels  as  compared  with 
the  other  Australasian  colonies,  and  perhaps  with  many  older  countries. 
Here,  at  least,  legislation  has  been  introduced  that  has  been  most  violently 
assailed  as  being  experimental,  socialistic,  confiscatory  and  impracticable. 
But  regardless  of  this  terrible  arraignment,  the  taxation  laws  have  been 
fully  and  successfully  established  and  given  practical  effect,  even  while 
other  countries  were  theorizing  on  the  same  principles. 

It  is  true  there  were  many  who,  through  the  public  press,  in  the  halls 
of  legislation,  and  on  the  highways  and  byways  of  the  country,  proclaimed 
their  belief  that  the  changes  in  the  incidence  of  taxation  would  surely 
involve  the  country  in  financial  ruin;  but  subsequent  events  conclusively 
demonstrated  how  ill-founded  were  their  apprehensions.  The  most  deter- 
mined opposition  to  the  "new  taxation"  came  from  the  moneyed  institu- 
tions, loan  companies,  and  the  owners  of  vast  landed  estates.  It  was 
found,  however,  as  soon  as  the  new  system  became  law  and  was  thor- 
oughly established  and  fully  understood,  that,  instead  of  involving  the 
colony  in  ruin,  it  had  exactly  the  contrary  effect.  The  credit  of  the  colony 
in  London  (which  is,  of  course,  the  centre  of  financial  operations  so  far 
as  the  colonies  are  concerned)  increased  to  an  unprecedented  degree. 
New  Zealand's  credit  is  better  to-day  on  the  London  money  market  than 
is  that  of  any  other  colony  of  Australasia. 

As  will  be  seen  above  the  opposition  came  from  the  moneyed 
classes  and  from  land  speculators  in  the  colony;  they  had  no 
doubt  about  the  effect  of  the  tax.  A  synopsis  of  the  system  is 
given  here. 

Up  to  1 89 1  a  land  and  personal-property  tax  was  imposed;  but  during 
the  years  of  depression  the  colonists  generally  complained  of  the  personal- 
property  tax  as  being  a  grievous  burden.  One  of  the  first  acts  of  the 
new  government  was  to  abolish  the  "property  tax"  and  substitute  an  "im- 
provement tax."  All  improvements  on  land  up  to  $15,000  were  exempt, 
but  all   improvements  above  that  amount  were  taxed. 

The  deduction  of  mortgages  and  of  improvements  up  to  a  value  of 
$15,000  renders  very  many  owners  exempt  from  land  tax,  the  total  number 
of  land-tax  payers  in  1891  being  12,557  out  of  a  total  of  91,501  owners 
of  land  in  the  colony.  It  will  be  borne  in  mind  that  there  is  an  exemption 
fo  $2,500,  so  that  no  man  pays  any  taxes  for  state  purposes  until  his 
property  is  worth  over  the  above  amount.  The  special  exemption  just 
referred  to  reduces  the  number  of  taxpayers.  An  owner  whose  land  and 
mortgages,  after  the  deduction  of  mortgages  owing  by  him  and  of  improve- 
ments up  to  the  value  of  $15,000,  do  not  exceed  $7,5oo  is  allowed  a 
deduction   by   way   of   exemption    of    $2,500    (already   mentioned),    and   this 


SINGLE   TAX  ^^ 

amount  gradually  diminishes  until  it  disappears  altogether  when  an  owner's 
assessed  value,  less   reductions,    reaches   $12,500. 

In  addition  to  the  ordinary  land  tax,  a  graduated  tax  is  levied,  and  for 
this  all  improvements  are  deducted;  but  an  owner  is  not  allowed  to  make 
any  deductions  for  mortgages  owing  by  him,  and  he  has  not  to  include  in 
his  return  any  mortgages  owing  to  him.  This  tax  is  not  imposed  on  any 
owner  the  value  of  whose  land,  less  the  improvements  thereon,  does  not 
exceed  $25,000,  and  the  lowest  rate  imposed  is  one-eighth  of  a  penny  in 
the  pound.  The  rate  gradually  rises  until  it  reaches  twopence  in  the 
pound  on  the  improved  value  of  lands  up  to  $1,050,000   or  more. 

This  tax,  it  will  at  once  be  seen,  is  an  approach  to  the  Single 
Tax  advocated  by  Mr.  Henry  George.  In  general  principle  it  is 
the  same ;  that  is  to  sa}-,  it  makes  it  difficult  to  hold  land  out  of 
use  and  makes  improvement  easy  by  exempting  it  from  tax  up 
to  the  limit  of  $15,000. 

The  most  interesting  and  valuable  part  of  the  report  shows 
that  the  present  tax  has  come  along  these  years  of  experiment 
exactly  in  line  of  ]\Ir.  George's  plan: — 

In  1891,  as  already  mentioned,  the  property  tax  was  abolished  and  a 
tax  on  improvements  substituted.  In  1892  the  tax  act  was  so  amended  as 
to  exempt  all  improvements  under  £3,000  in  value,  and  in  1893  improve- 
ments of  every  kind  were  exempt^fd  and  an  income  tax  introduced  instead. 
By  the  abolition  of  the  tax  on  improvements  a  loss  to  the  revenue  of  the 
country  was  sustained  equal  to  about  £37,000,  but  this  loss  will  be  com- 
pensated for  in  some  degree  by  the  scale  of  graduated  tax  having  been 
increased. 

Thus  in  three  years  the  entire  system  of  taxation  has  been  almost  com- 
pletely changed,  and,  it  is  gratifying  to  say,  with  the  most  beneficial  effect. 
Each  change  made  was  in  the  direction  of  relieving  those  who  were  least 
able  to  pay  and  making  those  to  whom  the  additional  burden  of  taxation 
would  make  no  material  difference  contribute  (what  they  had  not  hitherto 
done)   a  fair  share  of  the  revenue  required  in  proportion   to  their  means. 

Let  the  reader  note  whence  the  opposition  came.  Mr.  Con- 
nolly goes  on  to  say : — 

It  was  persistently  alleged  by  the  banking  and  moneyed  institutions 
generally,  and  also  the  large  land  owners,  that  the  radical  changes  made 
in  the  incidence  of  taxation  would  result  in  such  a  serious  loss  to  the 
revenue  of  the  country  that  borrowing  must  again  be  resorted  to  imme- 
diately to  defray  the  expenses  of  the  government,  but  the  results  have 
proven  they  are  not  prophets. 

The  common  people,  however,  having  felt  the  good  effects 
of  this  system,  returned  the  promoters  of  it  to  power  with  the 
largest  majority  ever  given  a  government  in  Neiu  Zealand.    The 


78  SELECTED   ARTICLES 

significance  of  this  is  that  they  have  discovered  the  barrier  to 
progress,  landlordism,  and  propose  to  aboHsh  it. 

In  addition  to  this  land  tax  with  its  exemptions,  they  have 
also  a  graduated  land  tax  and  an  income  tax.  The  income  tax 
is  not  satisfactory  thus  far,  but  of  the  graduated  land  tax  Mr. 
Connolly  says : — 

Graduated  Land  Tax 

There  is  what  is  known  as  a  graduated  land  tax,  in  addition  to  the 
ordinary  tax  of  the  same  kind,  on  land  values  over  £5,000  ($25,000) 
in  round  figures.  The  object  of  imposing  this  additional  tax  is  to  compel 
those  possessed  of  large  estates  and  who  are  holding  them  for  speculative 
purposes  to  either  subdivide  or  offer  such  lands  for  bona  fide  settlement. 

Under  the  circumstances,  the  justice  and  wisdom  of  this  act  are  quite 
apparent  when  it  is  remembered  that  1,766  owners  hold  from  1,000  to 
10,000  acres  each,  232  owners  hold  from  10,000  to  50,000  acres  each,  and 
thirty  owners  hold  over  50,000  acres  each. 

The  improved  value  of  land  held  by  fourteen  land  owners  amounts 
to  $27,690,245,  while  six  owners  hold  land  the  improved  value  of  which  is 
$12,813,900.  The  total  value  of  unimproved  land  held  in  large  areas- 
say  from  5,000  acres  upwards — in  1892  amounted  to  the  vast  sum  of 
$272,360,875.  Thirty-two  companies,  such  as  banks,  land  and  loan  com- 
panies, insurance  and  mortgage  societies,  own  1,321,036  acres,  the  im- 
proved value  of  which  is  given  by  the  commissioner  of  taxes  at  $12,916,405; 
and  the  unimproved  value  is  by  the  same  authority  said  to  be  equal  to 
$9,467,690.  From  the  foregoing  figures,  it  will  be  observed  that  it  has 
become  necessary  to  take  some  steps  to  prevent  the  further  accumulation  of 
vast  estates  and  the  withholding  of  them  from  settlement  and  development. 
Though  the  graduated  tax  is  not  regarded  as  being  too  burdensome,  yet  it  is 
to  a  large  extent  having  the  desired  effect.  Many  of  the  immense  estates 
are  being  freely  offered  to  the  government  at  their  taxable  value,  while 
some  arc  being  cut  up  in  suitable  farms  and  offered  at  public  auction. 

In  order  to  discourage  absentee  landlordism  the  reformers  in 
New  Zealand  have  imposed  an  extra  burden  of  twenty  per  cent 
additional  tax  upon  those  who  have  been  absent  three  years. 
This  however  is  only  a  quibble.  All  landlordism  should  be  made 
unprofitable,  absentee  or  resident. 

With  regard  to  the  Single  Tax  itself,  Mr.  Connolly  goes  on  to 
remark : — 

The  Single   Tax 

That  there  is  very  little  difference  between  the  present  land  tax  and 
the  Single  Tax  as  proposed  by  the  Single  Taxers,  as  they  are  called  here 
in  New  Zealand,  is  easily  shown.  The  principal  points  of  difference  may 
be   briefly   explained.     The   Single  Tax  would   be  levied  at  a   uniform  rate 


SINGLE   TAX  79 

and  without  exemption  upon  all  properties,  irrespective  of  size.  The  mort- 
gagee would  be  treated  in  precisely  the  same  manner  as  the  owner,  i.  e., 
it  would  consider  him  as  being  part  owner  of  the  improvements,  as  well  as 
of  the  land.  There  would  be  no  absentee  tax;  all  land  owners  would  be 
treated  alike.  The  £500  exemption,  the  absentee  and  graduated  tax  (ex- 
clusive of  the  income  tax)  are  the  only  diverging  features  as  between  the 
Single  Tax  and  the  present  land  tax. 

Mr.  Connolly  a  few  years  ago  bitterly  opposed  the  Single  Tax. 
He  seems  now  to  understand  very  thoroughly  the  arguments  of 
the  single-tax  men  and  comes  very  near  to  agreement.  [Appar- 
ently the  American  farmer  is  a  land  owner.  As  a  matter  of 
fact  he  is  a  renter  or  wage-earner.  He  has  very  little  land  value 
to  tax,  and  as  under  the  Single  Tax  all  his  improvements  would 
be  exempt  and  all  indirect  taxation  abolished  he  would  be  one 
of  the  greatest  gainers.  He  is  now  quite  landless.  He  owns 
under  mortgage  or  he  rents.  These  conditions  existed  in  New 
Zealand  but  are  being  changed  by  the  tax  on  land  values.] 

At  the  same  time  it  is  worth  the  while  of  the  Single  Tax  men 
to  consider  the  matter  of  an  exemption  in  connection  with  the 
introduction  of  the  Single  Tax  among  the  American  farmers. 
It  would  need  to  be  a  small  exemption,  say  $750  or  $1,000.  In 
some  states  it  could  be  $1,000.  The  case  would  then  stand.  The 
farmer  would  pay  no  taxes  on  his  improvements,  and  no  taxes 
on  his  land  values  until  those  values  rose  above  $1,000.  Let 
him  also  remember  that  improvement  value  is  exempt;  it  is 
merely  site  value  which  must  exceed  the  thousand-dollar  limit. 

Personally  I  feel  certain  that  an  exemption  is  not  needed, 
because  on  the  majority  of  farms  in  bona  fide  farming  districts 
the  improvements  exceed  the  site  value  of  the  land,  and  the 
farmer  having  his  stock,  tools  and  buildings  exempt  would 
at  once  pay  less  taxes  than  now.  In  cases  where  the  land  value 
exceeded  improvements,  the  exemption  of  improvements  from 
taxation  would  make  improvement  easier,  and  the  decreased 
price  of  lumber,  coal,  iron  and  other  commodities  which  would  be 
released  from  monopoly  would  also  aid  in  making  improvement 
easy.  [In  short  the  man  who  feels  the  New  Zealand  tax,  and 
the  man  who  would  feel  the  effects  of  the  Single  Tax,  is  the  man 
who  is  living  by  rents,  or  by  interest,  which  is  only  rent  in 
another  form.  In  other  words  the  man  who  earns  his  living 
will  find  his  burden  lightened,  while  the  man  who  lives  in  the 
sweat  of  his  neighbor's  face  will  find  that  power  cut  down.] 


8o  SELECTED   ARTICLES 

In  the  case  of  New  Zealand  another  point  is  of  special  value. 
Mr.  Connolly  says  : — 

The  number  of  taxpayers  has  decreased  under  the  land  and  income 
tax  by  nine  thousand  twenty-eight,  while  the  revenue  has  increased 
$100,000.  It  is  to  the  absentee  and  graduated  tax  that  the  increase  may 
be   attributed. 

This  is  to  say  the  poor  have  been  released  from  tax  and  the 
monopolist  has  been  made  to  shoulder  part  of  the  load.  Observe 
that  this  would  not  have  happened  if  the  tax  had  been  placed 
upon  the  improvements  of  the  wealthy,  for  if  placed  upon  any- 
thing whose  price  could  have  been  raised  to  cover  the  tax,  the 
consumer  would  have  paid  his  original  burden  and  more  too, 
in  indirect  taxes.  Being  placed  upon  land  values  it  decreased  the 
trice  of  land  and  brought  it  into  the  market,  thus  making  it 
impossible  to  shift  the  tax. 

This  is  a  fundamental  principle  of  the  Single  Tax,  It  makes 
land  plentier  and  therefore  lower  in  price,  and  it  cannot  be  shifted 
by  raising  the  price  of  land  so  long  as  land  is  being  brought  into 
the  market  in  increasing  quantities,  for  the  price  of  land  would 
fall  and  not  rise. 

That  the  Single  Tax  would  have  an  instant  effect  on  the  wages 
of  working  men  is  also  shown  by  this  report,  for  not  only  has 
the  colony  been  steadily  prosperous  through  the  hard  times  of 
the  last  year,  but  it  has  absorbed  without  ill  effects  a  constant 
stream  of  working  men. 

The  effect  of  the  tax  on  land  values  is  precisely  like  that  of 
opening  new  land  to  settlement.  It  brings  it  out  of  the  specu- 
lator's hands  into  the  settler's  hands.  It  passes  out  of  the  hands 
of  the  monopolist  into  the  hands  of  the  contractor  and  builder. 
Speculation  employs  no  labor.  The  moment  speculation  sur- 
renders its  hold,  use  begins  and  prosperity  begins.  This  was 
proven  in  New  Zealand. 

The  effect  of  opening  new  lands  by  taxing  speculation  reacts 
through  all  trades.  It  benefits  the  shop  girl  and  the  mechanic 
as  well  as  the  settler,  the  gardener  or  the  builder.  There  is  an 
empire  of  land  out  of  use  right  here  in  our  eastern  cities  and 
their  suburbs.  This  land  can  be  opened  to  use  in  one  way 
and  only  one  way,  by  making  it  unprofitable  to  hold  it  out 
of  use— that  is,  by  taxing  it  precisely  the  same  as  if  it  were  in 
use. 


SINGLE   TAX  8i 

This  is  the  fundamental  idea  of  the  plan  pursued  in  New 
Zealand  with  such  fine  results,  and  this  is  the  fundamental  prin- 
ciple, of  the  Single  Tax.  The  working  farmer  has  no  more  cause 
to  fear  it  than  the  mechanic.  It  will  lift  the  burden  which  they 
have  borne  so  long  upon  their  bowed  shoulders,  and  it  will  tax 
back  into  the  common  treasury  a  value  which  the  whole  people 
creates  and  which  a  few  monopolists  at  present  enjoy. 


Atlantic  Monthly.  112:737-46.  December,  1913. 

Case  for  the  Single  Tax.     F.  W.  Garrison. 

Briefly  stated,  the  Single  Tax  is  a  method  of  raising  money 
for  the  necessary  expenses  of  government  by  taking  the  rent, 
or  the  annual  yield  of  land-values,  alone,  abolishing  all  other 
forms  of  taxation,  direct  or  indirect.  It  may  be  described  as 
government  without  taxation,  for,  if  the  Georgian  contention  is 
true,  the  rent  of  land  belongs  not  to  the  individual  who  would  be 
required  to  surrender  it,  but  to  the  community  as  a  whole. 

On  what  just  basis  can  I  claim  exclusive  right  to  a  part  of  the 
limited  surface  of  the  earth?  "No  man  made  the  land,"  said 
Mill.  "It  is  the  original  inheritance  of  the  whole  species."  No 
matter  how  far  we  delve  into  the  past,  we  can  find  no  just  title 
to  the  private  ownership  of  land.  A  Vermont  judge,  when 
asked  to  return  a  fugitive  slave  to  the  man  who  claimed  owner- 
ship, replied,  "Show  me  a  bill  of  sale  from  the  Almighty  and  I 
will  deliver  him."  The  same  reasoning  may  be  applied  to  land 
titles  with  equal  force.  Blackstone  admits  that  "there  is  no 
foundation  in  nature,  or  in  natural  law,  why  a  set  of  words 
upon  parchment  should  convey  the  dominion  of  land."  "Whilst 
another  man  has  no  land,"  says  Emerson,  "my  title  to  mine,  your 
title  to  yours,  is  at  once  vitiated."  And  Herbert  Spencer  main- 
tains that  land-titles  all  rest  on  force,  fraud,  or  cunning.  When 
Edward  I  sent  his  commission  to  inquire  into  the  existing 
judicial  franchises  in  1278,  Earl  Warenne  flung  a  rusty  sword  on 
the  table  and  cried,  "This,  Sirs,  is  my  warrant.  By  the  sword 
our  fathers  won  their  lands  when  they  came  over  with  the  Con- 
queror, and  by  the  sword  we  will  keep  them." 

Man  is  a  land  animal,  and  access  to  land  is  essential  to  human 
life.    If  the  earth  were  to  be  divided  among  all  men  living  to-day. 


82  SELECTED    ARTICLES 

in  shares  of  equal  value,  the  next  child  born  would  have  a  just 
complaint  against  a  bargain  which  ignored  his  inherent  right 
to  an  equal  share.  Jefferson  recognized  the  force  of  this  argu- 
ment when  he  declared  that  "the  earth  belongs  in  usufruct  to  the 
living."  Land  is  the  universal  mother,  capable  of  feeding,  cloth- 
ing, and  sheltering  all  her  children,  but  turned  by  perverse  human 
laws  into  an  unnatural  parent,  absurdly  indulgent  to  some  of 
her  offspring  and  merciless  to  others.  Land  is  the  source  of  all 
wealth ;  from  it  human  labor  extracts  "the  sum  of  all  things 
which  tend  to  satisfy  the  physical,  intellectual,  and  spiritual  needs 
of  mankind"  ;  and  being  the  reservoir  of  wealth,  it  must  not  be 
confounded  with  wealth,  to  which  it  bears  the  same  relation 
that  the  fabled  goose  bore  to  its  golden  eggs.  Concede  the 
exclusive  use  of  the  land  to  a  part  of  the  human  race,  and  the 
remainder  can  live  only  on  the  sufferance  of  the  proprietors. 

In  the  early  home  of  the  English  race  the  free  man  was 
distinguished  from  the  dependent  by  the  ownership  of  land.  But 
even  under  feudalism  the  possession  of  land  was  conditioned 
upon  a  return  of  some  kind  to  the  sovereign,  as  representative 
of  the  people.  Personal  property  in  England  was  not  taxed 
until  1188,  when  Henry  II  levied  the  Saladin  Tithe  for  a  crusade 
fund.  In  the  law  of  eminent  domain  we  still  acknowledge  that 
the  ownership  of  land  should  be  conditional  on  the  rights  01 
society  at  large.  Speaking  in  the  House  of  Commons,  Cobden 
described  the  transition  by  which  the  landlord  managed  to  evade 
his  just  burdens.  "For  a  period  of  one  hundred  and  fifty  years 
after  the  Conquest  the  whole  revenue  of  the  country  was  de- 
rived from  the  land";  but  it  was  gradually  shifted  until,  by  1845, 
land  contributed  but  one  twenty-fifth.  "Thus,"  he  declared,  "the 
land,  which  anciently  paid  the  whole  of  taxation,  pays  now  only 
a  fraction  .  .  .  notwithstanding  the  immense  increase  that 
has  taken  place  in  the  value  of  rentals.  The  people  fared  better 
under  the  despotic  monarchs  than  when  the  powers  of  the  State 
had  fallen  into  the  hands  of  a  landed  oligarchy,  who  first  ex- 
empted themselves  from  taxation,  and  next  claimed  compensation 
for  themselves  by  a  Corn  Law  for  their  heavy  and  peculiar 
burdens." 

In  the  early  days  of  settlement  in  the  United  States,  when 
land  was  plenty,  there  was  little  or  no  poverty.  Despite  a  lack 
of  capital,  subsistence  was  to  be  won  from  the  earth,  and  it  was 


SINGLE   TAX  83 

easy  for  the  laborer,  dissatisfied  with  his  wages,  to  become  his 
own  employer.  But  this  happy  condition  did  not  last  In  1873  an 
English  observer  echoed  the  warnings  of  Henry  George.  He 
called  attention  to  the  fact  that  the  country  was  "flinging  to  the 
winds  its  splendid  patrimony  and  recklessly  selling  and  alloting 
to  railway  companies  or  land-jobbers  what  might  be  the  national 
revenues  of  the  future.  What  repentance  awaits  that  country," 
he  exclaimed,  "for  having  given  to  some  of  the  railways  grants 
of  25,600  acres  per  mile  of  road,  and  for  assigning  to  the 
Northern  Pacific  Company  alone,  58,000,000  acres!"  It  is  esti- 
mated that  from  250,000,000  to  350,00,0,000  acres  of  the  public 
domain  have  been  "granted  to  the  Pacific  railways  or  illegally 
appropriated  by  persons  and  corporations  in  conspiracy  with  the 
agents  of  the  government." 

Repentance  has  been  late  in  coming,  but  it  has  taken  a  secure 
hold  on  the  country  at  last,  in  the  conservation  movement,  which 
aims  to  check  the  prodigal  waste  of  the  natural  resources  of  the 
government.  We  have  awakened  to  the  folly  of  permitting  the 
alienation  of  the  rich  mineral  deposits,  the  valuable  forests  and 
water-power  sites  which  still  fall  within  the  public  domain. 

Well  may  the  conservationist  ask  himself  if  the  bounties  of 
nature  were  stored  during  the  ages  for  the  special  benefit  of  the 
Morgans,  Rockefellers,  and  Carnegies,  their  heirs  and  assigns. 
Does  their  insight  and  financial  genius  sufficiently  compensate 
us  for  the  surrender  of  such  a  disproportionate  share  of  the 
common  inheritance?  And  if  not,  do  their  princely  charitable 
bequests  square  the  account?  When  we  look  about  us  upon  the 
accumulating  misery  which  the  most  highly  organized  charity 
and  the  richest  endowments  have  proved  themselves  powerless 
to  stay,  we  can  but  ask  ourselves  if  the  doctors  have  correctly 
diagnosed  the  case.  Charity  is  like  a  drug  which,  taken  habitually, 
weakens  the  moral  fibre.  It  warps  the  judgment  of  him  who 
gives  and  him  who  receives.  In  the  Middle  Ages  men  bought 
indulgences  from  the  Pope.  To-day  they  buy  them  from  their 
conscience  with  a  dole  to  charity.  It  was  the  contemplation  of 
such  a  state  of  things  that  led  Maeterlinck  to  ask  if,  after  all, 
charity  were  aught  but  the  "insolent  flame  of  permanent 
injustice." 

That  whatever  a  man  creates  by  his  own  la-bor  belongs  ex- 
clusively to  him,  and  cannot  justly  be  claimed  by  any  one  else, 


84  SELECTED   ARTICLES 

is  regarded  by  Single-Taxers  as  a  self-evident  truth,  and  by  its 
acceptance  they  become  the  champions  of  property  in  its  true 
sense,  and  the  implacable  foes  of  privilege.  They  recognize  three 
factors  in  the  production  of  wealth:  land,  labor,  and  capital  (or 
wealth  set  apart  to  aid  in  the  production  of  more  wealth)  ;  and 
between  these  three  factors  the  product  must  be  divided.  The 
share  of  land  is  rent,  that  of  labor,  wages,  and  that  of  capital, 
interest.  Confusion  may  arise  from  failure  to  make  clear  the 
meaning  of  the  term  rent.  In  common  parlance  no  distinction 
is  drawn  between  the  sum  paid  for  the  use  of  land  and  that  paid 
for  the  use  of  factories,  houses,  machinery,  and  so  forth.  The 
distinction  is,  however,  all-important.  The  return  received  in 
the  form  of  rent  from  all  things  created  by  labor  is  in  reality 
either  wages  for  the  labor  expended,  or  interest  on  the  capital 
employed,  and  may  be  said  to  be  earned.  But  the  rent  arising 
from  land,  known  as  economic  rent,  can  be  credited  to  no  in- 
dividual effort  and  is  in  fact  the  measure  of  social  activity.  It 
exists  "wherever  any  particular  portion  of  land  affords  superior 
opportunities,  or  advantages  of  fertility  or  situation,  over  that 
which  is  freely  open  for  any  one  to  use." 

The  flood  of  humanity  which  flows  and  ebbs  daily  through 
a  great  city's  thoroughfares  gives  to  those  localities  exceptional 
opportunities  in  the  way  of  trade,  and  men  are  willing  to  pay 
large  sums  to  do  business  there.  Imagine  every  building  swept 
away  by  some  catastrophe;  so  long  as  the  population  remained 
alive,  the  rental  value  of  the  land  would  persist.  In  Baltimore 
and  San  Francisco,  land-values  rose  after  fire  had  done  its 
worst.  It  is  not  due  to  the  genius  or  industry  of  the  Astors  or 
the  house  of  Bedford  that  land  in  the  heart  of  New  York  and 
London  sells  at  the  rate  of  $15,000,000  an  acre.  From  their  roots 
safely  imbedded  in  the  soil,  they  flourish  like  the  lilies  of  the 
field,  although  they  toil  not.  They  need  do  no  work  nor  risk 
a  cent  of  capital;  in  other  words,  they  need  not  contribute  in 
any  way  to  the  production  of  wealth,  and  yet  they  have  the 
power  to  use  wealth  in  excessive  abundance. 

Greatly  concentrated  land-values  are  to  be  found  in  railway 
franchises  and  exclusive  rights  of  way  for  telephone,  telegraph, 
pipe-lines,  and  so  forth,  in  docks,  the  control  of  water-power 
sites,  oil,  gas,  and  mineral  deposits.  The  annual  mineral  output 
of  the  United  States  amounts  to  $2,069,289,196  according  to  the 


SINGLE   TAX  85 

U.  S.  Geological  Survey  for  1908.  Frederic  C.  Howe  points  out 
that  a  royalty  of  twenty-five  per  cent  on  this  natural  monopoly 
alone,  would  yield  $517,322,299,  or  almost  as  much  as  the  sum 
collected  through  the  customs  and  internal  revenue.  It  is  esti- 
mated that  the  ownership  and  control  by  the  railways  of  the 
anthracite  coal  deposits  in  Pennsylvania  makes  it  possible  to 
take  from  the  consumer  from  one  to  two  hundred  million  dol- 
lars a  year  above  a  reasonable  cost  of  producing  the  yearly  out- 
put. The  stupendous  income  from  natural  monopoly,  now  ab- 
sorbed by  private  interests,  can  be  easily  imagined. 

As  land-values  fluctuate  in  precise  agreement  with  social  de- 
velopment, there  are  losses  as  well  as  gains  to  be  taken  into 
consideration.  When  Edward  I  massacred  the  inhabitants  of 
Berwick,  "the  greatest  merchant  city  of  northern  Britain  sank 
from  that  time  into  a  petty  seaport."  Every  one  is  familiar  with 
the  ups  and  downs  of  special  localities  in  our  modern  cities. 
But  it  remains  true  that,  taking  a  community  as  a  whole,  so  long 
as  it  is  developing,  and  evolving  a  higher  state  of  civilization,  so 
long  will  the  land  continue  to  yield  an  increasing  rent.  We  are 
not  here  concerned  with  the  landlord  as  a  laborer  or  capitalist.  He 
may  improve  his  land  by  building  offices  or  factories  upon  it, 
and  for  their  use  receive  what  is  commonly  called  rent,  but  only 
that  part  of  the  sum  which  represents  desirability  of  situation 
is  rent  in  the  economic  sense. 

It  may  be  urged  that  the  returns  which  the  landlord  receives 
in  the  shape  of  rent  are  the  reward  of  skill  and  foresight  in  in- 
vestment, and  that  great  rewards  are  only  fair  where  the  chances 
of  failure  are  great.  And  we  are  often  told  that  if  society  takes 
the  increase  of  value  on  land,  it  ought  to  make  good  the  decrease 
of  value  which  is  a  kindred  phenomenon,  Single-Taxers  believe 
that  speculation  in  land  is  as  inexcusable  as  speculation  in  air  or 
light  would  be ;  and  indeed  it  involves  them  both.  Speculation 
will  cease  as  soon  as  the  landlord  is  obliged  to  turn  over  to  the 
public  treasury  the  full  economic  rent,  a  sum  which  will  vary 
with  the  varying  fortunes  of  the  locality.  At  the  same  time  he 
will  reap  the  full  reward  of  his  industry  and  not  be  mulcted 
by  taxation  as  at  present.  Withholding  land  from  use,  in  antici- 
pation of  increased  values,  leads  to  the  intolerable  trinity  of  idle 
land,  idle  rich,  and  idle  poor. 

Every  improvement  made  by  a  city  in  comfort  or  beauty  is 


86  SELECTED   ARTICLES 

reflected  in  higher  rents.  "There  was  a  block  of  traffic  in  Ox- 
ford street,"  said  Arnold  Bennett.  "To  avoid  the  block  people 
actually  began  to  travel  under  the  cellars  and  drains,  and  the 
result  was  a  rise  of  rents  in  Shephrd's  Bush!"  Every  tunnel 
under  the  Hudson  River,  every  new  bridge,  and  all  added 
facilities  of  travel,  serve  but  to  increase  the  revenues  of  the 
suburban  land-owners  and  the  transportation  companies.  Indeed 
land-owners  frequently  receive  damages  for  public  works  that 
increase  the  value  of  their  property.  Fortunately  this  custom 
is  coming  into  disrepute  as  light  is  let  in  upon  the  land  question. 

Mill  gave  the  name  of  "unearned  increment"  to  the  increase 
of  value  which  normally  accrues  to  the  land  in  every  growing 
community,  as  it  is  not  earned  by  the  landlords  into  whose 
pockets  society  permits  it  to  be  diverted.  Manhattan  Island  was 
bought  from  the  Indians  for  $28,  and  the  land  of  New  York 
City  is  now  valued  at  more  than  $3,500,000,000.  The  phenomenal 
increase  in  land-values  is  daily  reported  in  the  columns  of  the 
newspapers.  Mr.  Joseph  Fels,  an  ardent  disciple  of  Henry 
George,  offers  a  personal,  if  modest,  example.  A  few  years  ago 
he  bought  eleven  and  one  half  acres  of  land  in  West  Philadelphia 
for  $37,500.  The  city  moved  in  that  direction  and  three  thousand 
houses  were  built  in  the  vicinity.  As  a  result,  and  without  im- 
proving his  property,  Mr.  Fels  saw  its  value  leap  in  successive 
stages  to  $125,000.  He  does  not,  however,  pretend  that  this 
growing  value  is  justly  his,  or  due  to  his  skill  or  foresight.  "The 
unearned  increment,"  he  says,  "in  justice  and  right,  belongs  not 
to  me,  but  to  the  community.  I  have  done  nothing  to  make 
that  value.  My  part  has  been  to  hold  the  land  out  of  best  use. 
Yet  the  profit  is  mine  legally,  and  I  have  some  consolation  from 
the  thought  that  I  intend  to  expend  it  in  such  a  way  that  condi- 
tions may  be  changed,  to  the  end  that  neither  I  nor  any  other 
man  shall  have  the  power  to  make  money  out  of  the  work  and 
sweat  of  others.  I  shall  do  my  part  in  this  work  by  devoting 
money  and  efforts  to  disseminating  the  truth  concerning  what 
some  of  our  opponents  speak  of  slightingly  as  "the  Single  Tax," 
which  some  refer  to  lovingly  as  the  economic  philosophy  of 
Henry  George,  and  which  I  shall  call  plain  justice." 

John  Moody  gives  the  estimated  wealth  of  the  nation  in  1907 
as  about  $120,000,000,000,  and  figures  that  about  one  half  is 
what  might  be  called  created  wealth.    The  balance  he  calls  spon- 


SINGLE   TAX  87 

taneous  wealth,  or  unearned  increment.  Here  we  have  a  social 
fund  upon  which  no  individual  has  a  just  claim,  and  amply 
sufficient  for  the  needs  of  government.  Why  not  use  it  for  that 
purpose  and  remit  the  tribute  exacted  from  labor  and  capital 
by  taxation? 

"Why  tribute?  Why  should  we  pay  tribute?  If  Csesar  can 
hide  the  sun  from  us  with  a  blanket,  or  put  the  moon  in  his 
pocket,  we  will  pay  him  tribute  for  light;  else,  sirs,  no  more 
tribute,  pay  you  now." 

What  that  tribute  is  becomes  apparent  whenever  we  trace  the 
action  of  our  tax  laws.     Having  aUenated  the  fund  for  govern- 
ment needs    which    nature    provides,    other    sources    of    revenue 
had  to  be   found  and  taxes   levied  that  would  raise  the  most 
money  with  the  least  outcry.    Hence  arose  the  indirect  taxation 
which  has  found  its  fullest  flower  in  that  luxuriant  but  poisonous 
growth— the  protective  tariff.     The  Roman  taxes  were   farmed 
out  to  syndicates  which  at  least  paid  the  expenses  of  collection 
out  of  their  spoils.    But  the  beneficiary  of  the  protective  system 
absorbs  his  tribute  without  expense,  shifting  the  heavy  burden 
of  collection  upon  the  government,  which  receives  but  a  small 
part  of  the  general  contribution.    And  from  the  amount  collected 
by  the  government  must  be  deducted  the  actual  cost  of  custom- 
houses and  a  huge  force  of  clerks  and  spies  withdrawn  from 
productive   employment,   to   say  nothing   of  the   moral   cost   of 
creating  an  artificial  crime  and  fostering  international  jealousies. 
The  well-to-do  make  a  great  outcry  over  double  taxation,  and 
rightly,  but  few  concern  themselves  with  the  multiple  taxation 
of  the  poor.     For  it  is  upon  the  poor  that  the  bulk  of  taxation 
falls,  the  rich  having  ways  of  shifting  a  large  part  of  the  burden 
upon  those  beneath.     A  tax  has  been  likened  to  a  hot  copper 
which  is  quickly  passed  from  one  hand  to  another  until  it  reaches 
the  last  man  in  the  line,  who  gets  burned.    Thomas  G.  Shearman 
estimated  that  "taxes  are  so  arranged  as  to  take  from  the  poorer 
classes  75  to  80  per  cent  of  their  annual  earnings  while  exacting 
from  the  rich  only  3  to   10  per  cent."     When  Air.   Rockefeller 
gives"  $10,000,000    to    Chicago    University    he    is    the    ostensible 
donor;  the   real   contributors   are  the  unknown   thousands   who 
must  pay  tribute  to  Air.  Rockefeller  on  account  of  his  monopo- 
lies as  gigantic  landlord  and  tariff  beneficiary.     "As  the  laws  are 
to-day,"  says  Lawson  Purdy,  "no  wealthy  man,  who  has  legal 


88  SELECTED   ARTICLES' 

advice,  need  pay  any  direct  taxes  on  personal  property"  Those 
who  cannot  hide  or  afford  expert  service  mnst  pay. 

Glance' at  the  problems  which  keep  pace  with  the  growth  of 
material  prosperity,  the  familiar  picture  of  concentrated  wealth 
and  abject  poverty  side  by  side.  We  cannot  see  the  palaces  of 
the  rich  without  being  conscious  of  the  neighboring  slums,  where 
human  beings  live  crowded  together  in  miserable  hovels,  unable 
even  to  enjoy  the  light  and  air  to  which  no  man  as  yet  claims  ex- 
clusive title,  and  which  are  supplied  by  nature  in  boundless  pro- 
fusion. What  does  the  slum  landlord  give  his  tenants  in  return 
for  the  rent  he  exacts  for  squalid  buildings  in  surroundings  that 
breed  disease  and  death?  He  gives  the  privilege  of  occupying 
a  site  made  valuable  by  the  pressing  needs  of  society,  and  in- 
creased in  value  artificially  by  land  held  idle  for  speculative 
gains.  But  if  the  social  value  were  reclaimed  for  public  purposes, 
idle  land  would  be  forced  into  use  and  the  owners  of  tenements 
would  have  to  offer  better  homes.  Competition  would  keep  rents 
within  bounds,  and  laborers,  released  from  taxation,  would 
have  more  to  spend  on  the  decencies  and  comforts  of  life.  And 
the  landlord,  no  longer  taxed  on  every  improvement,  would 
have  some  incentive  to  add  to  the  attractiveness  of  his  property. 

If,  by  taking  economic  rent  for  public  purposes,  we  release 
idle  land,  and  at  the  same  time  encourage  industry  by  the  re- 
moval of  taxes,  we  are  respecting  the  rights  of  property  with 
scrupulous  nicety ;  and  we  shall  create  a  demand  for  labor  which 
will  solve  the  menacing  problem  of  unemployment.  The  vice 
and  crime  which  spring  from  slums  as  naturally  as  disease,  and 
are  in  fact  disease,  will  be  checked  at  their  source.  Remove 
from  the  breasts  of  the  criminals, .  who  prey  upon  society,  the 
ever-present  feeling  that  society  is  arrayed  against  them,  and 
that  laws  are  made  and  administered  for  the  rich,  and  wdio  can 
say  what  forces  of  regeneration  will  spring  into  action? 

Nor  is  there  any  other  solution  than  freedom  from  taxation 
for  the  bitter  and  wasteful  struggle  between  labor  and  capital. 
Their  needs  are  in  fact  the  same,  for  capital  has  no  other  office 
than  to  facilitate  labor  in  the  production  of  added  "wealth.  •  The 
issue  is  confused  because  the  capitalist  is  often  a  monopolist  as 
well.  The  common  enemy  of  both  capital  and  labor  is  monopoly, 
and  when  it  is  abolished,  each  will  receive  its  reward  in  interest 
and  w^ages.     The  increased  demand  for  labor  will  make  wages 


SINGLE   TAX  89 

higher,  and  labor  unions  will  be  unnecessary;  and  the  fear  of 
deadly  competition  being  removed,  the  immigration  problem  will 
cease  to  be  a  problem  at  all,  and  workers  from  other  lands  will 
be  welcomed  to  aid  in  the  production  of  wealth  the  natural 
limits  of  which  have  never  been  described. 

The  abolition  of  tariffs  and  the  recognition  of  the  right  to 
the  use  of  the  earth  which  all  its  inhabitants  possess,  will  at  last 
lay  the  spectre  of  war,  and  lead  to  the  abandonment  of  an  armed 
peace  which  is  only  less  crushing  and  brutalizing  than  war  itself. 
It  will  be  no  small  gain  to  be  rid  of  the  military  class  with  its 
"natural  drift  toward  lawlessness  and  violence."  The  drones 
created  and  maintained  by  the  army  and  navy  establishment  and 
the  bureaucracy  of  tax  departments  will  be  freed  for  productive 
labor.  In  fact,  there  is  no  social  question  occupying  men's  minds 
and  absorbing  their  energies  that  will  not  be  modified  by  the 
liberation  of  the  land.  Political  corruption,  which  usually  starts 
from  the  headquarters  of  monopoly,  will  cease  from  lack  of 
temptation. 

The  remedy  is  not  a  visionary  one.  Forty  years  ago  John 
Macdonell,  in  his  book  on  th,e  Land  Question,  said :  "We  vex 
the  poor  with  indirect  taxes,  we  squeeze  the  rich,  we  ransack 
heaven  and  earth  to  find  some  new  impost  palatable  or  tolerable, 
and  all  the  time,  these  hardships  going  on,  neglected  or  mis- 
applied there  have  lain  at  our  feet  a  multitude  of  resources 
ample  enough  for  all  just  common  wants,  growing  as  they  grow, 
and  so  marked  out  that  we  may  say  they  form  Nature's  budget. 
.  To  no  transcendental  motives  does  the  project  appeal. 
It  demands  no  miraculous  draught  of  administrative  talents  or 
public  virtues.  It  is  simple  and  intelligible.  It  is  nothing  but 
giving  the  body  politic  the  blood  which  it  has  secreted." 

It  is  not  uncommon  to  hear  persons  who  admit  the  force  of 
the  abstract  argument  declare  that  private  monopoly  in  land  has 
been  sanctioned  so  long  by  custom  that  to  abolish  it  would  lead 
to  unwarranted  confiscation.  They  point  to  the  fact  that  many 
innocent  persons  have  invested  in  land  at  the  high  prices  which 
a  monopoly  system  creates,  and  they  demand  compensation  for 
the  vested  interest  attacked.  The  same  arguments  that  served 
in  the  agitation  over  slavery  are  heard  again,  and  England's 
compensation  of  slave-owners  is  held  up  for  our  admiration. 
The  fact  is  that  in  the  case  of  land  monopoly,  as  in  that  of 


90  SELECTED   ARTICLES 

slavery,  there  are  conflicting  demands  to  be  settled.  Nobody 
suggested  that  the  slaves  be  compensated  for  their  loss  of  wages, 
and  no  one  today  suggests  that  the  people  whose  substance  has 
flowed  so  long  into  the  landlord's  coffers  be  compensated  for 
their  arrears  of  tribute.  But  may  they  not  as  justly  seek  compen- 
sation as  those  whom  it  is  proposed  to  deprive  of  their  monopoly? 

The  abolition  of  any  legalized  wrong  involves  hardship  to 
those  who  are  profiting  by  it,  and  the  longer  it  is  postponed,  the 
greater  the  penalty  which  justice  exacts.  To  take  the  people's 
money  to  purchase  for  them  something  which  in  nature  belongs 
to  them  is  too  absurd,  and  it  is  safe  to  say  that  it  will  not  be 
attempted  in  this  instance.  The  process  doubtless  will  be  to 
concentrate  taxation  gradually  on  land-values,  relieving  industry 
at  the  same  time.  This  method,  involving  delay,  does  not  mete 
out  full  justice,  but  it  is  at  least  in  line  with  human  progress. 
"Compromise  is  man's  law,  to  do  right  is  God's." 

To  those  who  have  seen  a  vision  of  better  times  to  come, 
any  step  in  the  right  direction,  however  feeble,  however  hesi- 
tating, brings  courage  and  hope.  Such  is  the  legislation  embodied 
in  the  Lloyd  George  Budget  of  1909,  with  its  tax  of  a  half-penny 
in  the  pound  on  the  value  of  land  (with  some  exceptions),  and 
twenty  per  cent  on  the  unearned  increment.  The  amount  of 
justice  done  is  slight,  but  the  recognition  of  the  principle  is  of 
supreme  importance,  and  the  popular  education  accomplished 
by  the  political  campaign  has  been  far-reaching  in  its  results. 
The  potential  power  in  the  movement  to  free  the  land  was  thor- 
oughly apprehended  by  the  great  land-owning  class,  and  hence 
the  desperate  resistance  made  by  the  House  of  Lords  (or  the 
House  of  Landlords,  as  it  has  been  aptly  termed).  The  lords 
failed  to  heed  Cobden's  warning  to  land-owners  against  forcing 
the  subject  of  taxation  upon  the  attention  of  the  middle  or 
industrial  classes.  "Great  as  I  believe  the  grievance  of  the  pro- 
tective system,"  he  said,  "mighty  as  I  consider  the  fraud  and 
injustice  of  the  Corn  Laws,  I  verily  believe  you  will  find  as  black 
a  record  against  the  land-owners  as  even  the  Corn  Law  itself. 
1  warn  them  against  ripping  up  the  subject  of  taxation." 

Whether  or  not  it  is  a  characteristic  of  human  nature,  it  is 
an  undoubted  fact  that  laws  are  commonly  made  in  the  interests 
of  the  law-makers.  Sometimes  this  is  done  crudely  and  openly, 
for  the  personal  gain  of  a  legislator,  as  in  the  case  of  much  tariff 


SINGLE   TAX  91 

legislation;  more  frequently  it  is  accomplished  by  general  legis- 
lation, unconsciously  dictated  by  class  interest.  The  three  hun- 
dred and  sixty  peers  who  voted  to  reject  the  Lloyd  George 
Budget  own  almost  one  seventh  of  the  land  surface  of  the  United 
Kingdom,  an  area  equal  in  extent  to  sixteen  English  counties. 

Progress  and  Poverty  was  published  in  1879.  The  author 
claimed  no  originality  for  the  doctrines  he  expounded  regarding 
the  rights  of  land-ownership ;  but  in  exploding  the  commonly 
accepted  Malthusian  theory,  that  population  tends  to  increase 
faster  than  the  means  of  subsistence,  he  removed  forever  the 
stigma  which  rested  upon  political  economy.  The  "dismal  sci- 
ence" was  a  figment  of  the  Malthusian  imagination.  With  the 
realization  that  a  livelihood  is  within  the  reach  of  all  who  are 
given  access  to  their  birthright,  that  poverty  and  all  its  attendant 
evils  are  the  results  of  bad  laws,  and  not  decreed  by  an  inscrutable 
Providence,  arose  a  new  hope  for  social  regeneration.  We  need 
not  fear  the  shock  of  a  too  sudden  arrival  of  the  millenium.  To 
a  friendly  critic,  who  accused  Henry  George  of  too  expansive 
an  optimism,  he  replied,  "You  say  you  do  not  see  in  the  Single 
Tax  a  panacea  for  poverty.  Nor  yet  do  L  The  panacea  for 
poverty  is  freedom.  What  I  see  in  the  Single  Tax  is  the  means 
of  securing  that  industrial  freedom  which  will  make  possible 
other  triumphs  of  freedom." 

Seeing  the  cause  of  so  much  human  misery,  and  believing 
that  they  are  possessed  of  a  remedy,  Single-Taxers  are  naturally 
optimistic.  And  their  optimism  is  strengthened  when  they  look 
back  over  the  record  of  a  single  generation.  South  Australia 
was  the  first  to  respond  to  the  new  idea,  and  in  1886  adopted 
a  land-value  tax  which  was  later  extended  to  municipalities.  In 
Queensland  the  exemption  of  improvements  from  taxation  was 
begun  in  1891,  and  has  been  gradually  extended,  until  in  1905  a 
Conservative  government  made  the  exemption  complete.  More 
than  ten  per  cent  of  the  annual  value  of  land  now  goes  to  the 
community.  New  Zealand  began  to  tax  unimproved  land-values 
at  the  same  time,  and  nearly  one  half  of  the  total  taxes  now 
come  from  this  source.  In  1896  New  South  Wales  followed 
suit,  and,  with  the  cooperation  of  the  land-owners  in  some  in- 
stances, has  gone  further  than  any  other  state,  at  least  twenty 
per  cent  of  the  annual  land-values  being  taken  for  public  uses. 
Western  Australia  imposes  a  tax  on  land-values  for  state  pur- 


92  SELECTED    ARTICLES 

poses,  besides  giving  rural  districts  power  to  exempt  improve- 
ments. Tasmania  has  had  a  tax  on  the  unimproved  capital 
vakie  of  land  for  many  years.  Victoria  is  the  only  Australian 
state  which  has  held  back,  and  it  has  suffered  in  consequence, 
losing  population  to  states  where  industry  is  more  justly  re- 
warded. None  of  the  90,500  square  miles  of  Papua  (a  depen- 
dency of  the  Commonwealth)  can  be  alienated,  land  being  held 
on  lease  with  periodical  reassessment. 

In  the  German  Empire,  Prussia  was  the  first  to  give  its 
municipalities  the  power  to  tax  land-values,  and  most  of  the 
other  states  have  followed  suit,  and  the  power  has  been  widely 
used.  There  are  fifteen  hundred  villages  supported  from  the 
produce  of  communal  lands,  without  taxation,  and  in  some  of 
them  the  inhabitants  actually  receive  a  dividend.  The  German 
dependency  of  Kiauchou  in  China  is  under  the  partial  sway  of 
the  Single  Tax,  and  the  minister  for  the  Colonies  hopes  to  ex- 
tend the  system  to  all  the  other  German  colonies.  Two  Swiss 
cantons  tax  land-values  for  state  and  municipal  purposes,  and 
one  of  them  has  no  other  taxes.  Orson,  in  Sweden,  has  no  tax- 
ation, and  yet  provides  a  street  railway  free  for  all,  a  library, 
and  public  schools,  and  pays  its  own  taxes  to  the  central  gov- 
ernment. The  money  comes  from  a  communal  forest  which 
encircles  the  tow^n. 

The  United  States  has  been  slow  to  adopt  the  ideas  which  its 
citizens  have  done  so  much  to  popularize  throughout  the  world. 
Progress  and  Poverty  has  been  translated  into  all  the  European 
languages.  Not  long  before  his  death  Tolstoi  wrote,  "The  in- 
justice of  the  seizure  of  the  land  as  property  has  long  ago  been 
recognized  by  thinking  people,  but  only  since  the  teaching  of 
Henry  George  has  it  become  clear  by  what  means  this  injustice 
can  be  abolished.  At  the  present  time  the  abolition  of  property 
in  land  everywhere  demands  its  solution  as  insistently  as,  fifty 
years  ago,  the  problem  of  slavery  demanded  solution  in  Russia 
and  in  America.  The  supposed  rights  in  landed  property  are 
the  foundation  not  only  of  economic  misery,  but  also  of  political 
disorder,  and,  above  all,  of  the  moral  depravity  of  the  people." 

In  May,  1913,  an  international  Single-Tax  Congress  was  held 
at  Ronda,  Spain,  at  which  were  present  delegates  from  the  chief 
European  countries  as  well  as  from  the  Spanish-American  states, 
where  the  movement  has  entered  the  field  of  practical  politics, 


SINGLE   TAX  '    93 

But  nowhere  are  experiments  along  single  tax  lines  more  strik- 
ing than  in  Western  Canada,  where  the  taxation  of  land-values 
is  firmly  established  and  rapidly  extending.  A  large  number  of 
municipalities  depend  entirely  upon  this  form  of  taxation  for 
local  revenues  and  the  provincial  governments  are  moving  in 
the  same  direction.  Under  this  policy  the  growth  and  prosperity 
of  such  cities  as  Vancouver,  Edmonton,  and  Victoria  have  chal- 
lenged world-wide  attention  and  are  attracting  a  yearly  emigra- 
tion from  the  United  States  of  between  100,000  and  200,000  of 
our  most  industrious  and  wide-awake  citizens.  An  increasing 
pressure  is  thus  exerted  from  across  the  Canadian  border. 
The  Minnesota  report  on  taxation,  issued  in  1912,  predicts  that 
"within  the  next  ten  or  twenty  years  the  Single-Tax  principle 
will  be  adopted  by  every  taxing  district  in  Western  Canada." 

The  Canadian  practice  has  been  to  reduce  the  tax-rate  on 
personal  property  and  improvements  from  year  to  year,  in- 
creasing proportionately  the  rate  on  unimproved  land-values; 
and  the  Tax  Commissioner  of  Houston,  Texas,  has  followed  this 
example,  without  w^aiting  for  specific  legal  authorization.  But 
the  first  state  in  the  Union  to  adopt  legislation  of  this  character 
was  Pennsylvania.  The  new  statute,  passed  in  May,  1913,  obliges 
cities  of  the  second  class  (Pittsburg  and  Scranton)  to  reduce 
the  rate  on  buildings  to  ninety  per  cent  of  that  on  land  and  to 
continue  by  reductions  of  ten  per  cent  every  three  years  until 
a  fifty  per  cent  reduction  is  reached.  A  similar  bill  for  New 
York  City  is  pending  before  the  legislature.  It  proposes  to 
reduce  the  rate  on  buildings  to  one  half  the  rate  on  land  within 
five  consecutive  years. 


St.  Joseph  News  Press.     July  10,  1907. 

Land  Tax  in  Germany. 

Germany  has  been  experimenting  with  a  tax  on  land  values, 
and  the  result  is  interesting.  According  to  our  ex-consul  at 
Berlin,  William  C.  Dreher,  in  his  article  in  The  Review  of 
Reviews  for  April,  nearly  three  hundred  towns  and  villages 
have  adopted  the  system.  An  example  of  the  working  of  the 
law  is  instanced  from  the  city  of  Spandau,  where  it  was  estab- 
lished four  years  ago.    One  owner  of  extensive  suburban  lands 


94  SELECTED   ARTICLES 

there,  who  had  been  paying  only  $23  a  year  on  their  revenue, 
derived  from  potatoes  and  market  gardening,  had  his  tax  raised 
at  one  bound  to  $3,330.  The  subsequent  incidents  are  worth 
adding.  His  city  lots  went  like  hot  cakes  at  reduced  prices, 
and  the  community  profited  by  extensive  building  operations 
on  his  tract.     , 

Frankfort-on-the-Main  was  the  first  German  city  to  apply 
this  tax  in  1904.  Cologne  followed  the  next  year  and  at  this 
time  fifteen  Prussian  cities  are  taxing  land  valuations  according 
to  what  the  increment  is  w^orth.  The  state  legislatures  of 
Bavaria,  Baden,  Hesse  and  Saxony  are  agitating  at  present 
measures  of  varying  provisions  looking  to  the  introduction  of 
the  increment  tax.  In  some  of  the  legislatures  such  bills  have 
actually  passed  one  branch.  Four  of  Berlin's  suburban  towns 
have  applied  the  tax,  but  not  yet  Berlin  itself. 

Of  course  all  this  has  not  been  done  without  opposition. 
Holders  of  city  property  throughout  Prussia  are  up  in  arms 
against  the  new  tax ;  and  with  them  stand  the  thirty  or  more  land 
speculating  companies  in  Berlin,  which  have  invested  in  sub- 
urban real  estate  not  less  than  $18,000,000  within  the  last  three 
years.  The  agitation  for  the  land  value  tax  is  methodically 
carried  on  by  an  organization  of  tax-reformers  incorporated 
eight  years  ago  and  now  numbering  over  300,000  members. 

American  Magazine.  72:  221-30.  June,  1911. 

A  Community  That  Pays  Its  Own  Bills.  Albert  Jay  Nock. 
All  Canada's  public  land  with  its  timber,  minerals  and  water, 
not  only  in  Alberta  but  also  in  her  sister  province  of  Saskatche- 
w^an,  in  Manitoba  and  the  unorganized  Northwest  Territory, 
is  held  by  the  Dominion  Government  as  public  property  and  is 
not  for  sale.  "There  isn't  enough  money  in  all  England  or  the 
United  States  to  buy  a  single  acre,"  says  Mr.  Oliver,  plainly. 
"The  reason  is  that  the  Dominion  wants  citizens,  not  speculators." 
There  arc  no  land  grants  in  Canada,  either.  Canada  has  seen 
"development  by  private  enterprise"  at  work  in  the  United  States, 
and  knows  what  it  amounts  to,  and  knows  which  side  her  bread 
is  buttered  on. 

The  moral  influence  of  this  policy  is  very  striking.     I  had 


SINGLE   TAX  95 

a  particular  interest  in  observing  its  educational  effect  on  the 
thousands  of  our  people  who  are  moving  over  into  Canada  each 
year.  It  has  given  them  a  clear  idea  of  that  fundamental  doc- 
trine of  democracy,  the  right  of  public  property. 

It  is  a  brand-new  experience  for  our  emigrant  settlers,  for 
there  is  no  such  doctrine  anywhere  in  the  United  States.  The 
Constitution  is  iron-clad  on  the  right  of  private  property,  but 
none  of  our  constitution-builders  except  Franklin  and  Jefferson 
seemed  to  catch  any  glimmering  of  the  correlated  right  of  public 
property.  It  never  got  into  our  documents,  never  came  to  be 
part  of  our  thought,  and  hence  none  of  us  ever  considered  it 
seriously  or  perhaps  ever  realized  that  such  a  right  existed. 

Possibly— such  are  the  vices  of  our  education— nine  persons 
out  of  ten  who  read  this  article  may  have  to  make  a  conscious 
effort  to  realize  that  there  is  a  natural  difference  between  prop- 
erty in  land,  minerals,  timber,  water  powers,  etc.,  and  property, 
say,   in  a  house  or  a  suit  of  clothes. 

But  in  Canada,  laid  deep  in  the  foundation  of  this  new  civil- 
ization and  woven  into  the  opinion  of  the  people,  is  the  doctrine 
that  land  and  its  resources,  by  whomsoever  used  or  developed, 
is  public  property. 

And  now  on  top  of  this  comes  the  tax  policy  of  the  Province 
of  Alberta,  teaching  the  great  truth  that  a  community,  like  an 
individual,  should  live  on  what  it  earns. 

Land  is  public  property;  therefore  the  use  of  land  is  a  gov- 
ernmental privilege.  Canada's  general  land  policy  teaches  that. 
Well,  then.  Alberta  simply  chooses  to  live  on  the  income  of  her 
privileges.  She  does  not  beg  or  filch  from  her  citizens  by  taxing 
their  property.  She  leads  a  self-respecting  life.  She  had  but 
one  subject  of  taxation — her  land. 

It  seems  reasonable.  Governments  all  apparently  expect  their 
individual  units  to  live  on  what  they  earn.  Why  shouldn't  gov- 
ernments try  the  same  thing  themselves,  by  way  of  a  good  ex- 
ample?    Alberta  does. 

When  our  citizens  are  asked  to  contribute  under  the  general- 
property  tax,  I  often  wonder  that  it  does  not  occur  to  them  to 
ask  "Why  should  I  pauperize  the  government?  Why  should  I 
give  part  of  my  earnings  to  support  a  government  that  has 
resources  enough  of  its  own  to  take  care  of  itself  twice  over?" 

Some  of  our  correspondents  think  we  are  very  mawkish  in 


96  SELECTED   ARTICLES 

our  disinclination  to  curse  the  tax-dodgers.  They  think  we 
should  have  pilloried  the  big  corporations  that  do  not  pay  their 
personalty  tax,  and  that  we  ought  to  haul  jMr.  Carnegie  over  the 
coals.  Still,  it  is  rather  a  grave  thing  to  run  lightly  amuck  at  a 
fundamental  instinct  of  human  nature.  Each  of  us  has  the 
notion  pretty  well  ingrained  in  him  that  he  is  entitled  to  keep 
all  he  earns.  I  have  it;  so  have  you.  Probably  Mr.  Carnegie 
has  it,  and  Altman's  bondholders  or  Park  &  Tilford's,  whoever 
they  may  be.  And  the  instinct  is  right — that  is  the  reason  why 
no  other  theory  of  taxation  except  Alberta's  will  ever  be  found 
to  work.  Whether  we  fully  realize  it  or  not,  every  time  the 
government  bilks  us  of  some  share  of  our  rightful  earnings, 
whether  by  the  property  tax  or  the  income  tax  or  the  excise  or 
the  tariff  or  by  this  new  sweet  scheme  of  taxing  corporations, 
our  plain,  natural  sense  of  justice  is  offended,  and  we  will  dodge 
if  we  can.  There  is  no  use  trying  to  argue  a  legal  right  into  a 
moral  right;  human  nature  is  too  old  for  that.  The  fact  is  that 
we  will  get  out  of  it  whenever  we  can  because  we  know  we 
have  a  moral  right  to  keep  all  we  earn,  and  a  very  little  thought 
will  show  us  that  the  community  also  has  an  equally  valid  right 
to  keep  all  it  earns. 

Alberta  says  to  her  citizens :  "Here  is  land  with  its  potential 
wealth.  What  gives  value  to  it  is  the  number  of  persons  who 
want  it.  Help  yourself.  All  you  make  out  of  it  is  yours — no 
tax  on  property,  industry,  production  or  labor.  Pay  simply  what 
the  demand  (the  number  of  people  who  want  it)  determines 
the  privilege  is  worth.  H  you  can  make  ten  million  dollars  we 
won't  begrudge  you  a  single  dollar ;  and  if  you  want  to  put  up  a 
house  built  of  silver  or  gold,  we  won't  tax  it  a  cent.  But  whether 
you  choose  to  work  this  privilege  or  leave  it  idle,  you  will  pay  in 
either  case  just  what  it  is  worth." 

The  policy  of  the  United  States,  on  the  other  hand,  has  always 
been,  and  still  is,  to  alienate  her  resources  into  private  hands, 
and  deprive  herself  of  their  income.  The  laws  embodying  this 
policy  are  still  in  force.  The  United  States  invited  speculators, 
got  them,  fixed  up  a  comfortable  tax  policy  to  suit  them  (e.  g., 
the  Astor  family  and  Trinity  Church  in  New  York  City,  the 
railroads  and  the  Weyerhaeusers  in  the  Pacific  Northwest),  and 
we,  the  rank  and  file  of  the  disinherited,  pay  the  bills.  The 
United  States  is  in  the  position  of  one  who  throws  away  his 


SINGLE   TAX  97 

own  resources  and  lives  on  his  friends.  This  is  sponging,  and 
sponging  is  unpopular  and  degrading.  How  is  it  dignified  by 
being  transferred  from  men  to  governments? 

The  Province  of  Alberta  invites  citizens,  gets  them,  and  pays 
her  own  bills  out  of  her  own  income  without  passing  the  hat  for 
help.  The  Province  of  Alberta  exemplifies  collective  self-re- 
spect in  levying  no  tax  except  against  the  private  use  of  public 
property. 

Such,  in  briefest  outline,  is  Alberta's  tax  policy.  One  would 
like  to  believe  that  she  worked  it  out  by  careful  economic  study, 
but  to  tell  the  truth,  she  drifted  into  it  by  accident.  Alberta 
was  erected  into  a  province  only  five  years  ago.  Her  first  legis- 
lature knew  no  more  about  taxation  than  legislatures  ever  do, 
but  in  leafing  over  some  old  Territorial  legislation  they  found 
these  provisions,  thought  they  were  worth  trying  and  took  them 
over. 

No  one  knows  who  put  them  into  the  Territorial  statutes. 
Rumor  and  fable  have  been  busy  as  they  always  are  with  the 
origins  of  any  great  success,  but  the  fact  undoubtedly  is  that 
land  was  taxed  in  Territorial  days  because  there  was  nothing 
else  to  tax.  There  was  nothing  to  the  Northwest  at  that  time 
but  land  and  air,  and  since  the  air  was  not  assessable,  the  land 
was  the  only  thing  that  held  any  prospect  of  revenue. 

In  other  words,  by  good  luck  and  good  management,  Alberta 
shows  the  development  of  an  almost  purely  natural  system  of 
taxation. 

Admirable  as  Alberta's  policy  is,  she  does  not  insist  upon 
her  cities  and  towns  adopting  it.  She  gives  them  the  largest 
liberty  to  work  out  their  own  experiments.  Under  the  Village 
Act  her  smallest  communities  may  raise  their  revenues  to  suit 
themselves.  Most  of  them,  however,  have  fallen  in  with  her 
system ;  and  foremost  among  these  is  the  capital  city  of 
Edmonton. 

Edmonton  too,  like  the  province,  got  her  economic  education 
largely  by  accident.  She  began  with  taxes  on  "improvements," 
on  business  and  on  incomes.  She  gave  up  the  income  tax  because 
she  could  not  get  at  the  income  of  her  richest  citizens ;  the  busi- 
ness tax  passes  out  this  year  because  the  spirit  of  the  place  has 
been  educated  beyond  it,  and  her  improvement  tax  disappeared 
on  account  of  a  coUision  with  the  Hudson's  Bay  Company. 


98  SELECTED   ARTICLES 

When  the  Company  was  incorporated  in  1670,  King  Charles 
II  granted  them  territorial  rights  that  extended  virtually  over 
all  outdoors— rights  that  have  arisen  to  plague  the  Dominion 
Government  time  out  of  mind,  until  they  were  for  the  most 
part  bought  out.  One  block  of  the  Company's  remaining  land, 
however,  turned  up  in  the  very  center  of  Edmonton. 

The  Company  played  the  old  familiar  game  of  forestalling. 
They  did  not  use  the  land,  would  not  sell  it,  would  not  do  any- 
thing with  it  but  patiently  hold  it  until  the  influx  of  population 
into  Edmonton  had  sufficiently  enhanced  its  value. 

There  the  land  lay  like  an  ounce  of  putty  in  a  dyspeptic's 
stomach.  As  Edmonton  grew,  it  had  to  grow  around  this  un- 
assimilated  center.  All  the  public  utilities  were  intolerably 
strained.  Sewers,  water-pipes,  gas-pipes,  wires,  street-car  tracks, 
all  had  to  stretch  around  the  Company's  reserve. 

It  was  a  fearfully  expensive  business,  and  Edmonton  had 
the  wit  to  see  that  while  she  was  paying  all  the  bills,  the  Com- 
pany was  getting  all  the  benefit.  Edmonton  shortly  decided 
that  if  the  Company  wanted  to  play  dog-in-the-manger  with  that 
land,  they  were  welcome  to  the  privilege,  but  they  must  pay 
for  it.  So  she  exempted  her  improvements  and  laid  her  whole 
realty  assessment  against  the  capital  value  of  land.  As  popula- 
tion enhanced  this  value  year  by  year,  the  Company's  tax  bill 
grew  until  last  year,  with  great  complaint  and  vexation,  they 
sent  the  assessor  a  check  for  $74,44S-io.  Realizing  that  by 
another  year  the  bill  would  come  to  $100,000  or  more,  the  Com- 
pany gave  up  and  decided  to  put  the  land  on  the  market. 

Out  of  this  simple  and  universal  experience,  Edmonton  worked 
out  for  herself  an  incalculable  economic  benefit  and  a  far  more 
important  and  valuable  economic  education. 

There  is  not  a  city  in  the  United  States  that  has  not  had 
Edmonton's  initial  misfortune,  and  not  one  but  that  under 
freedom  of  the  taxing  power  could  have  coped  with  it  as  Ed- 
monton did.  But  our  constitutional  restraint  upon  the  taxing 
power  operates  wholly  in  favor  of  speculation,  wholly  against 
industry,   and   our  cities  are  helpless. 

Consider,  for  example,  Detroit,  Mich.  -The  site  of  Detroit 
used  to  be  farmed  by  a  commonplace  type  of  Canadian  French 
who  lived  on  peacefully  in  a  humdrum  way  until  the  city  came 
and   gave  their   realty   holdings   a   rousing   value.     Two    farms 


SINGLE   TAX  99 

called  the  Brush  and  Cass  farms,  lying  on  either  side  of  Detroit's 
main  thoroughfare,  were  held  persistently  out  of  use.  The  city's 
growth  had  to  sidestep  them  or  jump  over  them,  thereby  strain- 
ing public  utilities  (and  only  those  who  have  lived  out  Wood- 
ward Avenue  know  how  they  are  strained)  mightily  increasing 
the  burden  of  general  taxation,  inconveniencing  everyone,  caus- 
ing the  city  to  grow  out  of  all  symmetry — a  sheer  case  of  private 
benefit  at  public  cost.  These  pieces  of  land  remained  utterly 
useless  until  some  one  could  be  maced  out  of  the  right  amount 
of  premium  required  to  use  them. 

If  the  unused  land  in  Detroit's  present  area  were  put  under 
intensive  cultivation,  it  would  more  than  support  her  population. 
Unlikely  as  it  seems.  New  York's  would  very  nearly  support  hers. 
Few  realize  that  nearly  fifty  per  cent  of  New  York's  area  is 
unused   land. 

Well,  the  remedy  appears  simple — why  not  tax  it  into  use? 
Edmonton  did. 

First,  because  we  have  no  constitutional  freedom  of  the  tax- 
ing power.  The  Supreme  Court  would  like  nothing  better  than 
to  get  a  chance  at  a  proposition  like  Edmonton's.  Then,  second, 
we  have  had  no  Secretary  of  the  Interior  like  Mr.  Oliver  to 
teach  us  that  land  and  its  resources  are  public  property.  Again, 
we  have  no  British  Columbia  to  show  us  how  to  shift  the  burden 
of  taxation  from  industry  to  idleness.  Finally,  we  have  no 
Alberta  to  give  us  an  example  of  communal  self-respect  in  living 
on   its   own   earnings. 

No,  we  have  been  "going  by  the  Constitution,"  assuming  that 
the  only  test  of  private  property  is  the  ability  to  get  our  hands 
on  it ;  and  meanwhile  our  federal,  state  and  municipal  govern- 
ments are  contentedly  pauperized  by  a  general-property  tax. 

It  is  a  disgrace.  Say  what  one  likes  about  patriotism,  one 
can  feel  no  great  pride  in  belonging  to  the  only  civilized  coun- 
try in  the  world  that  mulcts  its  citizens  by  a  general-property 
tax.     It  is  unreasonable  to  expect  it. 

If  Canadian  reciprocity  would  only  enable  us  to  trade  off  our 
practical  politicians  for  public  servants  and  legislators  like  Frank 
Oliver  at  a  ratio  of  sixteen  to  one,  we  might  look  for  a  beginning 
of  better  things.  It  is  a  pleasure  to  believe  that  our  new  Secre- 
tary, Mr.  Fisher,  will  find  Mr.  Oliver's  statesmanship  a  most 
congenial  study. 


100  SELECTED   ARTICLES 

Alberta's  tax  system  and  Edmonton's,  excellent  as  they  are, 
are  not  yet  perfect.  There  is  one  weak  place  in  them  which  will 
shortly  be  remedied.  This  weakness  may  be  perceived  by  means 
of  the   following  anecdote : 

The  weakness  of  Edmonton's  system  (and  the  same  is  true 
of  Alberta's  provincial  system)  is  shown  in  letting  the  market 
value  of  that  lot,  which  is  not  centrally  located,  go  up  $20,000 
in  three  months  when  there  was  nothing  substantial  to  justify 
such  an  increase. 

Edmonton,  l)y  maybe  a  little  stretching,  has  30.000  population. 
She  covers  seventeen  sections  of  land,  nearly  half  a  township. 
The  Hudson's  Bay  holding  helps  largely,  of  course.  Now  the 
point  is  that  if  Mr.  O'Meara  had  bought  this  lot,  there  is  not 
near  population  enough  or  business  enough  in  Edmonton  to 
justify  his  making  any  present  use  of  it  (say,  in  the  way  of 
putting  up  a  building)  that  would  be  commensurate  with  the 
price  of  his  land. 

In  other  words,  $35,000  for  that  lot  is  a  valuation  far  and 
away  ahead  of  the  present  time,  and  $55,ooo  looks  ahead  a  great 
deal  farther  still. 

These  values  are  speculative,  not  actual.  They  do  not 
represent  the  worth  of  the  land's  present  use.  They  are  a 
mortgage  on  the  future,  a  discount  on  the  prosperity  of  the 
whole  community.  In  short,  like  Vancouver,  Calgary  and  all 
these  rapidly  growing  towns,  Edmonton  is  overcapitalized.  The 
capital  value  of  her  land  is  more  than  it  is  worth. 

Hence  Edmonton  realizes  that  she  needs  one  more  feature 
in  her  tax  system  and  she  is  on  her  way  to  get  it.  The  Prov- 
ince of  Alberta  realizes  the  same  need  and  she  too  will  shortly 
have  it. 

Edmonton  needs  to  change  her  basis  of  assessment,  and 
assess  against  the  rental  value  of  her  land  instead  of  against 
its  capital  value.  Alberta,  which  as  yet  needs  little  money  and 
contents  herself  with  levying  merely  an  acreage  tax,  will  shortly 
make  the  same  readjustment. 

The  change  is  assured  because  this  region  is  free— and  it  is 
the  only  region  I  ever  saw  that  was  free— from  the  superstition 
that  what  is  known  as  "the  real-estate  business"  is  the  index 
of  prosperity. 

People  believe  this,  I  suppose,  on  somewhat  the  same  theory 


SINGLE   TAX  wi 

that  induces  certain  hungry  savages  to  swallow  earth.  Specula- 
tive values  are  no  real  asset  to  a  community  because  the  only 
thing  that  land  is  good  for  is  to  use.  If  ^Ir.  O'Meara  had 
bought  that  lot  for  $35,ooo  and  sold  it  three  months  later  for 
$55,000,  he  would  simply  have  capitalized  future  annual  land 
rentals  to  the  amount  of  $20,000;  hence,  he  would  have  appro- 
priated $20,000  from  the  general  fund  of  Edmonton's  land  rent. 
He  would  not  have  earned  a  penny  of  it — as  he  himself  so 
handsomely  admitted — and  the  community  which  probably 
would  earn  it  some  time  in  the  future  would  have  lost  the 
money. 

It  is  worse  policy  to  overcapitalize  a  town  than  a  railroad — 
and  Heaven  knowB  that  is  bad  enough.  You  may  catch  up  to 
your  capitalization  in  time,  and  then  again  you  may  not.  Plenty 
of  land  booms  have  "busted"  and  some  are  bursting  now.  And 
when  you  do  catch  up,  the  money  is  not  there;  some  thrifty 
landowner  has  absorbed  it.  Meanwhile,  you  find  that  fictitious 
valuations  are  a  fearfully  troublesome  asset  to  live  up  to.  They 
increase  your  borrowing  power,  true,  but  this  again  is  a  snare, 
for  if  you  were  not  overcapitalized  you  would  not  need  to 
borrow.  Figuratively,  your  city  has  to  do  a  four-track  business 
over  a  single-track  road  and  scamp  repairs  and  operating 
expenses  in  order  to  keep  up  to  its  capitalization. 

But  let  us  suppose,  if  we  can,  that  Alberta's  tax  policy,  even 
as  it  stands,  had  been  in  effect  in  Washington  and  Oregon. 
Would  the  Northern  Pacific  be  holding  for  speculation  three 
million  acres  of  timber  land  worth  between  $100  and  $200  per 
acre — land  which  it  acquired  mostly  for  nothing  and  now  holds 
practically  tax-free? 

Would  it  be  holding  for  speculation  millions  of  acres  of 
agricultural  and  mineral  land  on  the  same  terms? 

Would  the  Weyerhaeusers  be  holding  for  speculation 
96,000,000,000  feet  of  standing  timber  in  the  Pacific  Northwest ; 
would  the  Southern  Pacific  be  holding  106,000,000,000  feet,  while 
their  henchmen  howl  against  the  Government  for  "retarding 
development"  and  "tying  up  our  natural  resources"  in  the 
National   Reserve? 

Hardly. 

If  Detroit  could  have  taxed  the  Brush  and  Cass  farms  into 
use,    would    she   not   be   a   better   and    richer   city   to-day?      If 


102  SELECTED   ARTICLES 

Portland,  Ore.,  could  treat  the  holdings  of  her  mayor  and  a 
few  of  his  political  cronies  as  Edmonton  treated  the  holdings 
of  the  Hudson's  Bay  Company,  would  she  not  be  indefinitely 
better  off?  If  Seattle's  land  values — but  O  my  soul,  let's  draw 
the  veil  of  merciful  silence  over  those ! 

Our  States  and  cities  cannot  save  themselves  from  the  sinister 
consequences  of  over-capitalization,  on  account  of  the  consti- 
tutional restraint  upon  the  taxing  pozver.  True,  without  it  they 
might  not  save  themselves  for  a  long  time  to  come  on  account 
of  our  protracted  training  in  the  idea  that  land  is  private 
property.  But  the  abolition  of  constitutional  restraint  upon 
the  taxing  power  is  the  first  step  in  our  education,  and  without 
it  we  can  do  nothing  and  learn  nothing. 

The  Province  of  Alberta,  the  city  of  Edmonton,  and  a 
multitude  of  smaller  places  in  Canada  are  merely  examples  of 
the  course  that  all  communities  will  take  when  they  are  free 
to  follow  their  economic  education. 

The  right  of  public  property  and  the  right  of  collective 
self-respect — these  two  principles  distinguish  the  Province  of 
Alberta.  These  conceptions  are  essential  to  democracy.  There 
is  no  doing  without  them.  Direct  legislation,  commission  gov- 
ernment and  so  forth,  which  are  interesting  us  just  now,  are 
all  very  well  in  their  way,  but  they  are  politics  and  politics  is 
machinery.  You  cannot  run  democratic  machinery  with  feudal- 
istic  steam.  A  people  that  will  tolerate  a  feudalistic  exercise  of 
the  taxing  pozver  cannot  express  itself  in  permanent  or  powerful 
democratic  institutions.  It  has  nothing  to  express.  But  where 
there  is  a  correct  theory  of  taxation,  where  there  is  a 
current  doctrine  of  public  property,  as  in  the  Province  of 
Alberta,  it  is  impossible  for  any  but  democratic  institutions  to 
flourish. 

For  instance,  in  Alberta  and  the  other  portions  of  Canada 
where  these  two  ideas  have  taken  root — the  right  of  public 
property  and  the  right  of  corporate  self-respect— they  run  up 
logically  into  a  very  large  practice  of  public  ownership.  Al- 
berta, Saskatchewan,  and  Manitoba  swept  out  the  Bell  Monopoly 
and  operate  their  own  telephones  over  immense  stretches  of 
rural  district.  The  service  is  excellent  and  very  cheap.  Grain 
elevators  and  certain  slaughterhouses  are  operated  as  public 
utilities.      The    cities    largely    operate    their    own     franchises, 


SINGLE   TAX  103 

including  trolley  cars.  The  Saskatchewan  Legislature  is  con- 
templating  an  ambitious  measure  of  leasing  back  all  its  coal 
and  water  powers  from  the  general  government  and  using  them 
in  a  comprehensive  scheme  for  the  ownership  and  distribution 
of  heat,  light  and  power  throughout  the  province.  The  people 
are  free-traders  from  the  Great  Lakes  to  the  Rocky  Mountains. 
The  Grain  Growers,  meeting  recently  at  Regina,  demanded 
straight  free  trade  and  a  Dominion-wide  policy  of  land-value 
taxation. 

Yet  the  people  do  not  call  themselves  Socialists  or  any  such 
high-sounding  name.  I  have  not  once  heard  the  word  Social- 
ism. They  seem  to  be  unconscious  that  they  are  doing  anything 
unusual.  The  officials  of  the  Province  of  Alberta  are  astonished 
at  the  floods  of  inquiry  that  pour  in  on  them  from  all  parts 
of  the  United  States.  They  conceive  of  themselves  as  doing 
only  the  natural  thing,  the  simple  and  reasonable  thing,  and  they 
are  amazed  that  it  could  create  so  much  interest  and  be  thought 
so  revolutionary. 

Summing  up  our  brief  investigation,  we  find  that  the  general 
government  of  Canada  exhibits : 

1.  Constitutional  freedom  of  the  taxing  power. 

2.  The   right  of  public  property. 
British  Columbia  exhibits : 

3.  The  partial  exemption  of  industry  and  production. 
Alberta  exhibits : 

4.  The   entire   exemption  of  industry. 

5.  The  doctrine  of  communal  solvency  and  self-respect,  in 
levying  no  tax  whatever  except  against  the  private  use  of  public 
property — against  the  rent  of  a  delegated  monopoly. 


American  Magazine.  72:335-8-  July,  1911. 

Why   Nature's   Way   Is   Best.    Albert   Jay   Nock. 

On  the  boundary  line  between  the  Canadian  provinces  of 
Alberta  and  Saskatchewan  lies  the  town  of  Lloydminster.  Half 
of  it  is  in  Alberta  and  half  in  Saskatchewan.  The  boundary 
line  runs  down  the  middle  of  the  main  street.  There  is  the 
same  taxable  area  on  each  side.  Local  improvements  requiring 
revenue — paving,  sidewalks,   fire  protection,   etc. — are  the   same. 


104  SELECTED   ARTICLES 

No  better  situation  could  be  made  to  order  to  give  example  of 
two  tax  systems  side  by  side. 

Alberta  permits  her  cities,  towns,  and  villages  an  unlimited 
freedom  of  the  taxing  power.  Saskatchewan  does  not.  Her 
restraint  is  very  slight,  but  she  does  not  trust  local  experience 
and  knowledge  to  the  full  as  Alberta  does.  She  prescribes  a  few 
subjects  of  taxation  for  her  towns,  and  among  them  are  real- 
estate  improvements,  to  be  assessed  at  60  per  cent  of  their  value. 

Lloydminster,  Saskatchewan,  therefore,  among  other  taxes, 
levies  against  improvements.  Lloydminster,  Alberta,  on  the 
other  hand,  taxes  nothing  that  can  move.  She  taxes  only  her 
land  values. 

Hence  everything  that  can  move  without  sacrificing  more 
than  the  advantage  in  taxation  comes  to,  moves  over  to  the 
Alberta  side.  The  Saskatchewan  town  was  started  two  years 
before  the  other,  and  many  considerable  investments  remain 
there  for  the  present ;  but  even  the  men  who  own  the  businesses 
on  that  side  are  building  their  residences  in  Alberta.  IMen  like 
Mr.  Bell,  Mr.  Cumming,  and  Air.  Scott,  who  conduct  respect- 
ively the  largest  hotel,  general  store,  and  hardware  business  in 
Lloydminster,  reside  on  the  Alberta  side.  New  business  locates 
in  Alberta,  as  a  matter  of  course.  Mr.  Ashton,  whose  business 
is  in  Alberta,  tells  me  that  if  his  building  and  stock  (now 
^exempt)  were  on  the  other  side  of  the  street,  it  would  make  a 
difference  of  al)out  $12,000  in  his  assessment.  I  submit  Lloyd- 
minster as  a  concrete  showing  of  the  effect  of  natural  taxation 
upon   prosperity. 

The  ]Vhcncc  and  JVhithcr  of  Prosperity 

Well,  you  say,  all  this  is  rather  to  be  expected.  Prosperity 
depends  largely  on  industry  and  industry  depends  on  popu- 
lation. Population  naturally  gravitates  toward  free  homes  and 
untaxed  labor,  and  these  are  the  result  of  the  land-value  tax. 
We  know  this  already. 

Yes,  but  here  is  a  point  that  is  sometimes  overlooked.  If 
population  and  industry  follow  the  land-value  tax,  as  they  do, 
they  must  follow  it  somewhere  aicay  from  somewhere  else.  If 
population  streams  tozvard  an  economic  situation  that  permits 
free  industry  and  free  homes,  it  must  stream  an'ay  from 
situations  where  these  are  not   free. 


SINGLE   TAX  105 

Lloj'dminster  shows  in  miniature  the  tendency  that  is  oper- 
ating very  powerfully  just  now  between  British  Columbia  and 
the  neighboring  States  of  Washington  and  Oregon ;  between 
Western  Canada  and  the  Eastern  provinces  as  a  whole ;  between 
cities  like  Calgary  or  Lethbridge  and  Edmonton  or  Vancouver ; 
and,  finally,  between  the  province  of  Alberta  and  the  rest  of 
the  Dominion. 

Mayor  Gaynor  had  us  all  dipping  into  Epictetus  a  little  last 
winter,  so  there  can  be  no  pedantry  in  recalling  what  Epictetus 
says  about  the  advantage  of  the  natural  way  of  doing  anything. 
If  you  once  get  hold  of  that,  you  can  defy  competition  from 
those  who  are  doing  it  in  an  unnatural  way.  Alberta  has 
gotten  hold  of  the  method  of  natural  taxation,  and  commu- 
nities that  try  to  compete  with  her  on  any  other  basis  are  out 
of  the   running. 

Hence,  sooner  or  later,  she  makes  them  toe  the  mark.  Self- 
preservation  finally  forces  them  into  line.  Sometimes  the  day  of 
reckoning  comes  far  sooner  than  one  would  think.  Even  after 
all  I  saw  of  the  land-value  tax  in  British  Columbia  cities,  I 
was  amazed  when  only  the  other  day  Victoria,  the  old,  staid, 
conservative  capital  city,  which  everyone  says  is  more  purely 
English  than  London,  voted  in  the  land-value  tax  by  a  majority 
of  eight  to  one. 

Why  did  she  do  it?  Because  she  could  not  compete  with 
the  other  cities  in  her  own  province  unless  she  did.  She  could 
not  stand  competition  with  Vancouver,  Prince  Rupert,  Nan- 
aimo,  any  more  than  Lloydminster,  Saskatchewan,  can  stand 
competition   with   Lloydminster,   Alberta. 

Put  the  question  to  yourself.  Other  things  being  equal, 
would  you  subject  your  industry  to  conditions  in  the  State  of 
Washington  where  taxation  covers  everything  but  fruit-trees 
and  credits,  where  assessed  valuations  are  so  discriminatory 
and  capricious  as  to  demand  a  local  rate  of  three  to  seven  per 
cent.,  if  you  could  exercise  it  in  the  comparative  freedom  and 
equity  of  British  Columbia? 

Or,  again,  if  you  were  in  Canada,  other  things  being  equal 
or  nearly  so,  why  should  you  try  to  offset  even  the  slight  burden 
of  provincial  taxation  on  your  industry  in  a  British  Columbia 
city  or  rural  municipality,  if  you  could  settle  in  Alberta  and 
escape  it  altogether? 


io6  SELECTED   ARTICLES 

Hozv    Washington   Stands   from    Under 

More  and  more  are  people  realizing  this  situation.  Here 
is  a  significant  fact :  For  one  year  past,  Vancouver,  the  largest 
city  of  British  Columbia,  has  wholly  exempted  real-estate 
improvements.  It  was  told — in  fact,  it  amounts  to  a  general 
understanding — that  during  the  last  six  months  an  average  of 
five  families  a  week  had  moved  from  Seattle  to  Vancouver.  I 
cannot  vouch  for  this  absolutely,  for  the  figures  are  not  official, 
but  I  am  so  far  from  doubting  it  that  I  only  wonder  there  are 
not  fifty.  The  Immigration  Office  at  Ottawa,  however,  does 
inform  me  officially  that  nearly  as  many  immigrants  have  left 
the  State  of  Washington  of  Canada  during  the  last  year  as 
during  the  three  years  preceding.     The  figures  are  as   follows  : 

1907  3>829 

1908   7,517 

1909  9,366 

1910    17,734 

The  doubling  of  immigration,  at  figures  of  that  size,  from 
one  year  to  the  next,  is  certainly  interesting.  Washington  and 
Oregon  together  have  in  four  years,  since  1906,  sped  43,979 
citizens  into  the  larger  liberty  of  the  Dominion  of  Canada. 

Alberta's  Lodestone 

But  going  back  to  the  conditions  that  chiefly  make  for 
Alberta's  prosperity,  we  find  that  of  the  329,409  who  have 
emigrated  from  the  United  States  to  Canada  in  the  past  four 
years  (and  incidentally,  that  means  also  a  minimum  of 
$329,409,000  that  went  with  them),  106,626,  or  approximately 
one  third,  settled  in  the  province  of  Alberta.  The  tide  of 
immigration  to  Alberta  is  swelling  each  year.  Now  Alberta  has 
some  natural  advantages,  it  is  true,  but  none  that  I  know  of 
over  Saskatchewan,  for  instance,  at  the  present  stage  of  settle- 
ment. When  population  becomes  more  dense.  Alberta  may  be 
found  a  little  better  off  than  her  sister  province,  but  even  that 
is  doubtful  and  certainly  not  to  be  considered  at  the  present 
time.  But  the  inexorable  economic  advantage  is  with  the 
province  of  Alberta  and  will  remain  with  her,  operating 
powerfully  against  her  competitors,  until  such  time  as  they  all 
fall  into  line. 


SINGLE   TAX  107 

♦Ontario,   Canada.   Tax   Reform   and   Direct   Legislation 
League. 

How  the  Farmer   Pays   City  Taxes. 

The  average  farmer  is  under  the  impression  that  the  taxing 
of  improvemeijjts  in  cities  is  a  matter  in  which  he  is  not  inter- 
ested, and  to  tell  him  that  the  taxes  levied  on  such  things  as 
buildings  and  business  takes  money  out  of  his  pocket,  and  in  fact, 
is  largely  paid  by  him,  would  appear  to  him  absurd.  Yet  it  is  a 
fact  that  every  dollar  of  taxes  levied  upon  buildings,  or  busi- 
nesses in  cities  takes  more  than  one  dollar  from  farmers. 

Let  us  give  the  matter  a  little  consideration.  There  are 
only  two  classes  of  things  which  are  taxed  to-day;  land  is  one, 
and  labor  products  the  other.  Let  us  consider  the  effects  of 
taxing  each  of  these  things  in  cities  and  towns  with  special 
reference  to  the  effects  upon  farmers. 

A  tax  upon  buildings  decreases  the  revenue  derived  from 
buildings  rented.  Thus,  a  tax  rate  of  20  mills  on  the  dollar,  a 
common  one  in  towns,  will  necessitate  an  increase  in  the  rent 
of  2  per  cent,  per  annum  over  and  above  what  is  required  to 
give  the  ordinary  return  to  capital.  That  is  to  say,  if  a  man 
ordinarily  was  content  with  the  return  of  6  per  cent,  on  his  money 
invested  in  buildings  he  would  require  to  collect  8  per  cent,  from 
his  tenant  in  order  to  have  6  per  cent,  left  when  taxes  are  paid. 

The  tenant  of  a  store  where  farm  produce  is  handled  must 
get  this  extra  rent  out  of  his  business  in  increased  margin  for 
doing  business ;  in  other  words,  out  of  his  customers.  This 
means  he  cannot  afford  to  pay  the  farmer  so  much  for  his 
products.  But  that  is  not  all.  In  all  other  businesses,  a  tax 
on  buildings  being  added  to  the  rent  increases  the  cost  of 
doing  business,  and  so  increases  the  cost  of  goods  to  the 
consumer.  This  reduces  the  demand  for  goods  and  the  number 
of  men  employed  in  the  manufacture,  and  consequently  the 
market  for  the  farmer. 

The  tax  being  added  to  the  rent  of  all  dwelling  houses 
reduces  the  amount  of  a  man's  income  by  the  amount  of  the 
tax,  and  so  reduces  the  purchasing  power  of  the  people  for  the 
goods  of  the  manufacturer  and  farmer.  This  re-acts  on  the 
farmer  again  in  higher  prices  for  things  that  he  needs  to  buy. 


io8  SELECTED   ARTICLES 

and  less  demand  for  what  he  has  to  sell.  Thus,  a  tax  on 
buildings  in  the  city  is  largely  borne  by  farmers  in  the  country. 

Now  let  us  consider  tlie  effects  of  taking  the  tax  off  buildings 
and  industry  and  placing  it  wholly  on  land  values  in  the  cities. 
It  is  a  notorious  fact,  that  over  one-half  of  the  area  of  every 
city  and  town  in  Ontario  is  vacant  land.  Now  this  land  is 
vacant,  not  because  no  one  wants  it,  but  because  the  owner 
is  not  willing  that  it  should  be  put  to  use  unless  he  is  first  paid 
a  price,  which  in  his  judgment  is  sufficient  to  tempt  him  to 
stand  aside  to  let  someone  use  it.  Often  this  price  is  four  times 
what  it  cost  him,  and  double  what  it  is  worth  for  anyone  to 
use,  but  until  he  gets  his  price  he  can  stand  in  the  way  of 
industry  and  those  who  could  and  would  use  it  at  a  fair  price 
are  compelled  to  pay  what  amounts  to  a  heavy  fine,  before 
they  are  allowed  to  produce  wealth  and  employ  labor,  or  else 
remain  idle. 

The  exemption  of  buildings  from  taxation  and  the  levying 
of  all  taxes  upon  land  in  proportion  to  its  value,  would  prob- 
ably increase  the  rate  in  towns  and  cities  to  4  per  cent,  of  the 
selling  price.  In  the  case  of  improved  property,  the  exemption 
of  the  building  would  usually  more  than  compensate  the  owner, 
except  where  poor  buildings  are  standing  on  very  valuable  land, 
in  which  case  it  would  be  an  inducement  to  replace  the  poor 
buildings  with  others  more  suited  to  the  locaHty.  It  would 
also  be  a  very  powerful  incentive  to  the  owners  of  vacant  land, 
either  to  build  or  to  sell. 

Now  with  taxes  of  four  per  cent  on  the  capital  value,  no 
one  would  buy  land  unless  he  was  prepared  to  build  upon  it. 
Two  results  would  follow.  First,  the  selling  price  of  the  land 
would  fall  probably  one-half,  that  is  to  say,  the  speculator 
finding  that  the  change  in  the  system  of  taxation  had  spoiled 
his  chance  of  holding  up  industry  for  the  increase  in  value 
which  increase  in  population  confers  upon  land,  he  would  sell 
at  any  price  he  could  get  if  he  could  not  use  it  to  advantage 
himself.  Second,  there  w^ould  be  immediately  a  great  increase 
in  the  demand  for  labor  and  building  material,  so  as  to  utilize 
the  land  released  by  the  speculator  and  bought  by  the  improver. 

Other  results  would  follow.  The  increased  demand  for  labor 
would  raise  the  wages  in  the  building  trades.  The  increased 
number  of  stores  and  dwellings  would  reduce  rent,  and  both  of 


SINGLE   TAX  109 

these  together  would  increase  the  ability  of  the  people  to  buy  the 
produce  of  the  farmers.  This  increase  in  demand  would  be 
further  increased  by  a  portion  of  wages  of  every  additional 
workman  employed  as  a  result  of  the  new  industrial  conditions. 

Let  us  sum  up.  The  effect  would  be  by  reducing  the  taxes 
upon  buildings  to  reduce  the  rent  by  at  least  that  amount.  The 
fall  in  the  price  of  land  by  the  destruction  of  the  profits  of 
land  forestalHng,  would  still  further  reduce  the  rent  required 
to  pay  the  ordinary  return  to  capital  and  the  increase  in  the 
supply  of  buildings  would  force  rent  down  to  that  point,  so 
that  rent  would  be  based  upon  the  reduced  value  of  land  and 
the  cost  of  the  buildings.  Other  results  would  be  higher  wages, 
more  men  employed,  and  a  larger  amount  of  wages  left  to  the 
workers  after  rent  was  paid ;  smaller  cost  of  selling  farm 
produce,  allowing  of  better  prices  to  farmers  and  reduced  prices 
on  goods  bought  by  farmers. 

We  think  we  are  well  within  the  limits  when  we  state  that 
a  sum  equal  to  the  whole  of  the  tax  imposed  on  buildings  in 
cities  or  towns  is  taken  from  the  farmers  in  increased  cost  of 
handhng  farm  produce ;  lower  prices  for  what  they  sell  and 
higher  prices  on  what  they  buy,  as  a  result  of  the  taxing  of 
buildings  and  businesses. 

That  is  why  the  tax  reform  in  the  cities  means  increased 
income  for  the  farmers. 

Tax  Reform  in  Ontario. 

Speculation  has  been  gradually  discouraged  and  industry 
encouraged    in    Ontario    as    follows : 

1819 — Vacant  land  in  cities  and  towns  assessed  4s.  as  wild 
land,  or  20s.  per  acre  as  meadow  land.  All  buildings,  improve- 
ments, and  personal  property  assessed. 

1837 — Assessment  on  vacant  land  in  towns  increased  to  £10 
an  acre.  Assessment  on  personal  property  reduced  nearly 
one-half. 

1888 — Assessment  of   farm    stock  abolished. 

1904 — Personal  property  tax  abolished.  Business  assessment 
substituted  for  personalty.  Separate  assessment  of  lands  and 
buildings. 

1910 — Farm    lands    exemption,    allowing    under-assessment    of 


no  SELECTED   ARTICLES 

lands  in  cities   abolished.     Income  exemption  increased  to  $900 
for    non-householders,    and   $1,200    for   householders. 

191 1 — City  of  Toronto  allowed  to  expropriate  200  feet  on 
either  side  of  proposed  street  extensions  and  improvements  to 
secure  increased  value  caused  by  improvement  or  extension  of 
street. 


Outlook  103:771-5.  April  5,   1913. 

Taxing    Enterprise.      Richard    Spillanc. 

The  history  of  my  business  is  not  different  from  that  of 
many  other  manufacturing  concerns.  My  troubles  are  the 
common  troubles  ten  thousand  others  suffer  under.  We  all 
know  they  exist ;  we  all  would  like  to  lessen  them,  but  we  are 
almost  helpless.  How  great  is  the  handicap  and  how  many 
are  the  obstacles  we  have  to  overcome,  few  persons  outside  the 
manufacturing  sphere  realize. 

Forty  years  ago  my  father  started  business  in  a  loft,  in  what 
is  now  the  downtown  district  of  a  Middle  West  city.  He  had 
eleven  men.  His  capital  was  small.  He  manufactured  machinery 
that  has  lightened  the  burdens  of  men  throughout  the  civilized 
world.  He  had  courage,  ability,  and  determination.  He  was 
not  only  a  good  manufacturer,  but  a  wonderful  salesman.  He 
took  great  pride  in  his  work.  He  never  let  a  piece  of  machinery 
go  out  of  his  shop  unless  it  was  perfect.  He  prospered,  and  as 
his  business  grew  he  required  more  space.  First  he  hired  other 
lofts  in  adjacent  buildings,  then  he  bought  a  building  or  two. 
Still  his  business  broadened.  Every  few  years  he  had  to  have 
more  space.  He  could  not  always  spare  the  money  from  his 
business  to  buy  the  property  he  needed,  so  that  which  he  could 
not  buy  he  rented. 

People  who  owned  property  around  my  father's  manufac- 
tory took  advantage  of  the  needs  of  this  industrial  space,  and 
they  doubled  and  trebled  rents  on  him.  They  would  not  give 
long  leases,  but  rented  only  from  year  to  year,  and  every  year 
they  raised  the  rent.  But  still  the  business  spread,  and  the 
factory  rambled  all  over  the  neighborhood.  In  some  instances 
my  father  managed  to  have  narrow  alleys  closed  by  public 
consent;  in  other  instances  he   tunneled   under  thoroughfares  or 


SINGLE   TAX  in 

bridged  across  them,  in  order  to  connect  his  various  buildings. 
Many,  many  men  fattened  on  my  father's  industry.    For  example : 

A  German  saloon-keeper  owned  a  piece  of  land  separating 
two  departments  of  our  work.  It  was  a  ramshackle  old 
building  that  the  German  used,  and  the  land  and  the  building 
cost  the  saloon  man  only  $4,000.  We  bought  that  ramshackle 
structure  sixteen  years  ago,  but  we  had  to  give  $16,000  to  the 
German  in  order  to  acquire  it. 

Now,  you  understand  that  there  was  nothing  to  increase 
the  value  of  this  saloon  man's  land  except  the  fact  that  we 
needed  it  for  manufacturing  purposes.  In  other  words,  the 
saloon-keeper  squeezed  $12,000  out  of  us  without  contributing 
one  cent  to  the  community,  either  in  money  or  effort.  We 
were  bled  by  all  the  property-owners  in  our  neighborhood. 
The  more  our  business  expanded,  the  higher  they  raised  the 
figures  on  their  property.  We  were  the  workers.  They  held  us 
up  for  a  good  share  of  our  profits. 

Things  got  to  such  a  pass  that  we  could  stand  it  no  longer. 
We  were  cramped  for  space,  but  could  not  get  the  space  without 
being  charged  an  extortionate  price.  We  explained  the  situa- 
tion to  the  property-owners,  but  it  was  no  use.  Then  we 
determined  on  radical  action.  Seven  years  ago  we  moved  our 
plant  to  open  land  on  the  outskirts  of  the  city,  where  there 
was  little  or  no  population. 

We  fenced  in  several  acres  of  land  and  proceeded  to  erect 
buildings  so  as  to  bring  our  organization  together  in  an  eco- 
nomical arrangement.  When  our  new  buildings  were  completed, 
we  abandoned  the  old  plant.  What  do  you  suppose  was  the 
result?  All  the  buildings  we  formerly  occupied  are  now  on  the 
market,  with  no  takers.  By  reason  of  our  abandoning  them 
they  have  declined  in  value  to  the  price  they  commanded  before 
my  father  began  manufacturing  in  that  little  loft  forty  years 
ago.  The  net  decline  represents  about  the  amount  we  paid 
in  premiums  and  excess  valuation. 

Now,  is  it  just  that  a  manufacturer  should  be  penalized 
because  he  is  industrious  and  because,  through  that  industry, 
he  has  to  have  more  space  for  his  plant?  Why  should  he  be 
singled  out?  A  railway  or  any  other  public  service  corporation 
that  has  to  have  land  for  enlargement  of  its  facilities  or  right 
of  way  can,  through  the  courts,  bring  condemnation  proceedings 


112  SELECTED    ARTICLES 

in  case  owners  of  property  are  not  willing  to  sell  at  a  reason- 
able price.  Appraisers  are  appointed,  and  the  railway  or  other 
public  service  corporation  obtains  the  land  it  needs  at  something 
like  its  market  value. 

Why  should  a  railway  have  greater  rights  than  a  manu- 
facturer? We  were  making  machinery  essential  to  society. 
A  railway  does  not  perform  a  fundamental  function  other 
than  transportation,  yet  it  is  protected  from  the  oppression  of 
real  estate  agents  and  land  speculators. 

We  are  to-day  employing  2.300  men.  In  other  words,  our 
business  is  a  revenue-producer  to  the  community  to  the  extent 
of  our  annual  pay-roll.  These  2.300  men  are  permanent  resi- 
dents of  the  city,  but  they  would  not  be  there  if  it  were  not 
for  the  fact  that  our  industry  is  established  in  that  city.  Ac- 
cording to  the  last  quadrennial  appraisement  it  is  estimated 
that  every  man  that  moves  in,  or  every  child  that  is  born  in 
the  comnnmity,  adds  about  $500  to  the  land  value.  This  means 
that  our  manufacturing  plant  has  added  $1,150,000  to  the  land 
values  of  our  city. 

Now,  considering  three  to  a  family  instead  of  four,  which 
is  the  usual  number,  this  brings  the  total  up  to  $3,450,000.  Our 
payroll  is  a  net  revenue  to  the  community,  which  goes  from 
the  merchant  to  the  jobber,  and  from  the  jobber  to  the  manu- 
facturer, and  in  turn  to  the  farmer.  It  percolates  through  all 
the  channels   of  production  and   trade. 

It  is  customary  to  consider  that  the  manufacturing  business 
belongs  solely  to  the  man  or  the  firm  or  the  corporation  which 
controls  it.  But,  as  a  matter  of  fact,  it  l)elongs  to  the  commu- 
nity as  much  as  does  the  courthouse  or  the  city  hall.  The  fact 
that  I  and  my  associates  have  title  to  the  property  does  not 
affect  the  community  interest. 

My  father  invested  all  his  earnings  back  into  the  business, 
in  the  improvement  of  our  product,  in  the  enlargement  of  our 
facilities.  My  associates  and  I  have  continued  the  same  policy 
since  my  father  died.  The  plant  is  owned  by  those  active  in 
the  business,  and  none  of  us  has  anything,  aside  from  this  Inisi- 
ncss,  except  onr  homes  and  a   few  insurance  policies. 

The  statistics  of  our  city  show  that  there  is  involved  an 
investment  in  machinery,  lands,  buildings,  etc.,  of  approximately 
$1,000  to  every  man  employed.     About  ten  years  ago  we  had  a 


SINGLE   TAX  113 

strike,  which,  in  loss  of  production  and  profits,  importation  of 
strike-breakers  and  detectives,  cost  us  $100,000.  The  cost  of 
this  strike  became  known  in  the  community  through  the  news- 
papers, and  it  was  a  common  expression  that  we  were  a  rich 
concern  and  could  afford  it.  In  fact,  that  the  loss  of  $100,000 
meant  practically  nothing  to  us. 

The  fact  that  this  was  the  only  strike  that  we  have  had  in 
the  forty  years  of  our  existence  would  indicate  that  we  have 
dealt  with  our  employees  justly.  I  wish  we  never  had  had  this 
one  strike.  It  is  one  of  my  sorrows.  As  I  look  upon  it  now,  I 
was  to  blame  in  a  large  part.  The  men  were  to  blame,  too. 
They  were  bent  on  making  trouble.  What  I  cannot  forgive 
myself  for  is  that  I  did  not  maintain  a  closer  relationship  to 
them,  learn  of  their  discontent  earlier,  and  remedy  the  wrongs 
that  brought  about  the  trouble. 

I  have  told  you  that  it  was  current  report  that  we  lost 
$100,000  through  that  strike.  We  did  not  actually  lose  that 
amount.  The  loss  was  to  the  community.  We  would  have 
invested  that  $100,000  in  more  machinery,  more  buildings,  and 
more  business  in  order  to  employ  more  men.  With  this 
$100,000  that  was  dissipated  through  the  strike  we  would  have 
employed  one  hundred  additional  men,  who  would  have  brought 
that  much  more  revenue  to  the  city.  Now  our  pay-roll  aver- 
ages approximately  $1,000  per  year  per  employee.  One  hundred 
additional  men  means  that  that  strike  cut  $100,000  from  the 
total  of  what  our  pay-roll  would  have  been.  Thus  the  commu- 
nity has  lost  that  many  dollars  per  year.  Consider  this  for  ten 
years  and  you  have  $1,000,000  loss  to  the  community.  Consider 
this  compounded  in  the  many  ways  in  which  such  things  ramify, 
and  you  have  a  total  that  is  not  pleasant  to  contemplate.  Do 
you  appreciate  that  the  community  has  a  decided  monetary 
interest  in  our  plant? 

In  moving  the  2,300  men  to  the  open  acreage  which  we 
purchased,  we  thought  we  had  settled  one  kind  of  our  trouble. 
We  brought  all  our  plant  together,  in  something  like  an  eco- 
nomical arrangement,  and  this  was  a  great  relief  to  us.  Much  as 
we  rejoiced  over  this,  we  rejoiced  still  more  in  our  proud 
belief  that  the  old  gray  wolf  of  the  land  speculator  was  not 
looking  in  at  our  door  any  longer.  We  rejoiced  too  early.  We 
have    another    wolf    at   our    door.     This    is   a   young   one;    an 

10 


114  SELECTED   ARTICLES 

offspring  of  the  one  that  preyed  upon  us  when  our  manufacturing 
plant  was  in  the  heart  of  the  city. 

We  found  that  by  moving  2,300  men  to  the  open  acreage  in 
the  outskirts  of  the  town  we  created  land  values  around  us. 
A  troop  of  speculators  have  trailed  us.  These  men  are  laying 
out  acreage  property  into  town  lots,  selling  the  lots  to  our  men 
and  others  who  are  attracted  by  the  system  of  trade  which 
2,300  workers  naturally  would  build  up.  We  thought  we  were 
establishing  our  plant  on  cheap  land,  yet  to-day  w^e  find  lots 
adjoining  our  property  selling  on  a  basis  of  $50  per  foot  front. 
The  tax  appraiser  comes  along  and  sees  that  these  40-foot  lots 
close  to  our  plant  and  used  for  store  property  are  selling  at 
$2,000.  What  do  you  suppose  he  does?  He  estimates  that  if  that 
storekeeper's  land  is  worth  $2,000  a  lot,  our  land  is  worth  as 
much,  if  not  more,  and  we  have  been  put  on  the  assessment 
roll  according  to  that  valuation.  We  are  being  punished  for 
that  which  we  have  built  up.  We  have  been  fined  for  our 
industry;  we  are  punished  for  investing  the  earnings  back  into 
our  business.  We  put  this  money  back  into  our  business  be- 
cause we  had  pride  in  our  achievement;  because  we  gloried  in 
the  fact  that  we  were  producing  more  and  better  goods  for  the 
benefit  of  mankind  than  any  other  men  in  our  land.  We  have 
great  pride  in  the  big  plant  that  has  resulted  from  our  efforts. 

Money  is  not  our  only  aim.  We  draw  generously  from  our 
earnings  for  our  needs,  but  it  has  been  the  one  aim  of  our  lives 
to  increase  and  to  broaden  our  business.  This  business  has  be- 
come a  monument  to  our  families.  We  might  have  been  selfish 
and  have  prospered  more.  We  have  been  producers,  workers. 
If,  instead  of  being  producers  and  workers,  we  had  invested 
our  earnings  in  real  estate  and  become  parasites,  we  probably 
would  have  done  much  better  in  a  financial  sense. 

At  first  glance  you  would  suppose  that  when  the  tax  assessor 
puts  his  valuation  of  $2,000  a  lot  on  our  land,  and  we  pay  the 
increased  tax,  that  ends  it  so  far  as  we  are  concerned.  But  it 
does  not.  The  effect  upon  us,  aside  from  the  tax,  is  indirect, 
but  is  more  vital  than  the  tax  itself.  As  the  land  values  in- 
crease around  our  place,  it  is  natural  that  the  men  who  work  for 
us,  and  who  live  on  these  lands,  will  have  to  pay  more  rent  or 
more  for  their  home,  or  higher  taxes.  The  land  around  our 
plant  affects  our  pay-roll.     Speculators  are  beginning  to  under- 


SINGLE   TAX  115 

stand  that  the  price  of  this  land  to-day  is  less  than  it  is  going 
to  be  five  years  from  now.  When  our  workmen  buy  from  the 
speculators  who  have  grabbed  up  this  land,  or  rent  from  those 
who  have  put  up  houses,  they  must  pay  both  principal  and 
interest.  Their  rents  become  higher  and  they  have  less  for 
food  and  clothing;  they  naturally  will  come  to  us  for  increased 
wages.  If  they  do  not  get  the  increase,  they  are  likely  to  strike 
and  paralyze  our  industry.  The  price  we  pay  for  this  strike  is 
the  land  speculator — a  man  who  has  not  handed  one  dollar, 
either  in  service  or  industry,  to  our  community  wealth,  but  has 
fattened  wholly  by  our  productive  industry. 

We  made  one  serious  mistake,  in  view  of  the  present  evil 
system  of  our  tax  laws,  when  we  relocated  our  plant.  We 
should  have  acquired  all  of  the  land  around  our  factory  in  order 
to  control  the  price,  and  then  we  should  have  sold  it  to  our  men 
at  a  moderate  cost.  But  even  this  would  have  been  doing  an 
injustice,  because  we  can  provide  a  greater  revenue  to  the 
community  and  perform  a  higher  duty  to  society  by  making  this 
investment  in  machinery  and  buildings.  As  I  consider  it  now, 
it  probably  was  better  to  do  as  we  did  rather  than  protect 
ourselves  against  the  machinations  of  the  land  investor. 

I  moved  our  plant  out  into  the  country  to  escape  real  estate 
and  tax  injustice.  I  have  not  escaped  either.  No  man  objects 
to  paying  an  honest  or  just  tax,  but  he  does  object  to  an  unjust 
tax.  Manufacturers  throughout  America  have  suffered  as  I 
am  suffering,  and  all  the  while  they  see  crafty,  clever  men,  who 
are  doing  nothing  for  the  world's  progress,  escaping  an  honest 
tax  on  their  property  simply  because  they  will  not  improve  it. 
For  example,  buildings  in  the  downtown  districts  of  the  city 
should  pay  the  bulk  of  taxation,  those  nearest  the  center  of 
trade  and  traffic  being  assessed  the  highest.  In  our  city,  right 
in  the  heart  of  the  busiest  section,  you  will  find  various  one- 
story  structures,  "taxpayers,"  they  are  called,  built  to  provide 
carrying  charges  until  such  time  as  the  owner  thinks  it  wise  to 
put  up  a  fair-sized  structure  or  a  sky-scraper.  These  "tax- 
payers" not  infrequently  adjoin  some  of  the  finest  structures 
in  the  city.  The  tax  on  the  "tax-payer"  is  trifling  in  comparison 
with  the  tax  on  the  sky-scraper.  In  the  same  neighborhood, 
too,  there  are  a  lot  of  superannuated  buildings,  structures  that 
were  erected  forty,  fifty,  sixty,  and  in  some  instances  seventy 


ii6  SELECTED   ARTICLES 

years  ago.  Rents  in  them  for  offices  are  very  high,  but  the 
tax  on  these  buildings  is  very  low  because  the  buildings  are 
not  worth  much.  As  a  matter  of  fact,  these  superannuated 
buildings  are  among  the  best  revenue-producers  in  the  city.  All 
land  values  are  based  on  desirability,  and  in  the  case  of  the 
mercantile  section  it  is  traffic  that  provides  the  element  of 
desirability.  Naturally,  each  of  our  employees  supplies  a  unit  of 
this  traffic.  If  taxes  were  placed  on  the  lands  of  these  congested 
sections,  and  laws  passed  that  would  relieve  a  man  from  a  fine 
for  putting  up  a  building  and  performing  a  social  service,  then 
the  owners  of  some  of  these  superannuated  buildings,  and  these 
taxpayers  who  are  holding  the  land  simply  for  increased  value, 
would  be  forced  to  pull  down  those  structures  and  put  up  ones 
that  would  pay  them  revenue.  Rents  to  merchants  would  be 
cheaper  by  reason  of  the  competition  of  many  and  more 
tenantable  buildings.  Under  a  proper  system  of  taxation  there 
would  not  be  the  inequality  and  injustice  that  there  is  to-day. 
It  seems  to  me  that  the  people  who  perform  useful  functions  to 
society  are  burdened  with  the  heaviest  taxes,  while  a  lot  of 
rich  but  indolent  people  live  on  unearned  increment. 

Our  whole  taxation  system  is  wrong.  There  ought  to  be  a 
readjustment.  Suppose  I  make  a  chair  for  my  own  use  in  my 
own  house.  The  community  has  no  right  to  participate  either 
in  its  value  or  in  its  use,  but  the  tax  man  comes  along  and  says : 
"This  is  a  perfectly  good  chair.  The  man  who  is  able  to  make 
and  sit  in  such  a  chair  certainly  is  able  to  pay  taxes."  So  he 
assesses,  say,  five  per  cent  of  its  estimated  value,  and  as  long 
as  the  chair  continues  in  use  and  I  do  not  hide  it,  five  per  cent 
of  its  value  goes  into  the  public  till,  until  its  entire  value  has 
been  absorbed  in  twenty  years. 

My  enterprise  and  general  desire  to  produce  is  dulled  by 
reason  of  the  fact  that  the  community  takes  away  my  product 
in  installments.  The  same  principle  is  proved  if  the  chair  had 
been  made  in  a  factory,  except  in  this  latter  case  it  is  not  only 
taxed  as  merchandise,  but  the  buildings  and  the  machinery  of 
the  factory  are  taxed,  all  of  which  must  be  added  to  the  final 
selling  price.  The  individual  or  the  industry  producing  with 
hands  or  brains  is  penalized. 

The  purpose  of  taxation  is  for  public  administration  and  for 
public  improvement.     It  is  supposed  to  be  for  the  good  of  all. 


SINGLE   TAX  117 

That  which  is  for  the  good  of  all  should  be  derived  from  that 
which  all  produce,  and  that  is  the  land  values  of  the  community. 
Land  values  are  made  by  population.  They  are  socially  created. 
To  my  mind,  the  tax  question  is  more  important  to  the 
American  people  than  the  tariff.  Unjust  taxation  has  hampered 
the  growth  of  many  an  industrial  establishment  and,  I  believe, 
has  ruined  many  a  concern.  It  has  driven  hundreds  of  plants 
away  from  one-  community  to  another,  uprooted  tens  of 
thousands  of  families,  and  done  no  end  of  wrong.  The  man 
who  solves  this  problem  so  that  the  inequalities  and  the  injus- 
tices of  the  present  system  are  wiped  out  will  do  a  great  work 
indeed. 


Kansas  City  Times.    March  13,  1912. 

Tax  System  Created  a  Fortune. 

In  1866  John  H.  Nagle  of  Seattle  took  the  160  acres  just 
east  of  Broadway  in  that  city  and  north  of  Madison  Street. 
That  it  had  no  value  then  is  shown  by  the  fact  that  anyone 
could  have  had  it  who  thought  it  worth  taking.  In  1874  Nagle 
became  insane  and  was  taken  to  Steilacoom,  where  he  was  left 
at  the  expense  of  the  taxpayers  until  1897,  when  he  died. 

That  his  land  had  little  value  in  1866  is  shown  by  the  fact 
that  he  traded  five  acres  of  it  for  a  blind  mule  a  short  time 
before  this.  A  trustee  of  his  estate  had  been  appointed  by  the 
court  when  he  became  insane,  who  sold  enough  of  it  from  time 
to  time  to  pay  the  taxes.  The  remainder  in  1898  was  worth 
fully  $300,000. 

Now  it  is  evident  that  this  value  was  not  created  by  John 
H.  Nagle,  who  was  in  an  asylum.  It  was  created  by  the  people 
of  Seattle.  Yet  the  city  had  to  pay  $11,000  to  his  estate  to  get 
the  three  blocks  on  which  the  reservoir  and  Lincoln  Park 
Playground  are  situated. 

It  is  also  evident  that  when  this  $300,000  was  given  to 
Nagle's  nonresident  heirs,  who  did  nothing  to  earn  it,  that  it 
was  taken  from  the  people  who  did  create  it.  Every  man, 
woman  and  child  in  Seattle  was  poorer  because  of  this  being 
taken  from  them.  If  anyone  gets  without  earning,  others  must 
earn  without  getting. 


SELECTED   ARTICLES 

Nebraska  State  Journal,  Lincoln.    October  lo,  igii. 
What  the  Single  Tax  Advocates  Claim   for  Their  Theory. 

We  assert  as  a  primary  principle  that  all  men  are  equally 
entitled  to  the  use  of  the  earth: 

Therefore,  No  one  should  be  permitted  to  hold  land  without 
paying  to  the  community  the  value  of  the  privilege  thus 
accorded;  and  from  the  fund  so  raised  all  expenses  of  govern- 
ment should  be  paid.  We  could,  therefore,  abolish  all  taxation, 
except  a  tax  upon  the  value  of  the  land  exclusive  of  improve- 
ments. This  tax  should  be  collected  by  the  local  government 
and  a  certain  proportion  be  paid  to  the  state  government. 

This  system  of  taxation  would  dispense  with  a  horde  of 
tax  gatherers,  simplify  government  and  greatly  reduce  its  cost. 

It  would  do  away  with  the  corruption  and  gross  inequality 
inseparable  from  our  present  methods. 

It  would  relieve  the_  f  armer,_the  workman  and  the  manu- 
facturer of  those  taxes  by  which  they  are  now  unjustly  bur- 
dened, and  take  for  public  uses  only  those  values  due  to  the 
public   growth   and  improvement. 

It  would  make  it  impossible  for  speculators  to  hold  land 
idle,  and  it  would  open  unlimited  opportunities  for  the 
employment  of  labor  and  capital,  which  is  essential  to  the 
solution  of  the  labor  problem. 

Briefly  stated  these  are  the  fundamental  principles  of  what 
those  who  advocate  it,  call  the  Single  Tax : 

We  propose  to  abolish  all  taxes  save  one  Single  Tax  levied 
on  the  value  of  land  irrespective  of  the  value  of  improvements  in 
or  on  it. 

What  we  propose  is  not  a  tax  on  real  estate,  for  real 
estate  includes  improvements.  Nor  is  it  a  tax  on  land  for  we 
would  not  tax  all  land,  but  only  land  having  a  value  irrespec- 
tive of  its  improvements,  and  would  tax  that  in  proportion  to 
that  value. 

Our  plan  involves  the  imposition  of  no  new  tax  since  we 
already  tax  land  values  in  taxing  real  estate.  To  carry  it  out 
we  have  only  to  abolish  all  taxes  save  that  on  real  estate,  and 
to  abolish  all  that  which  now  falls  on  buildings  or  improvements, 
leaving  only  that  part  of  it  which  now  falls  on  the  value  of  the 
bare  land.     This  we  would  increase  so  as  to  take  as  nearly  as 


SINGLE   TAX  119 

may  be  the  whole  of  the  economic  rent,  or  what  is  sometimes 
styled  the  "unearned  increment  of  land  values." 

That  the  value  of  the  land  alone  would  suffice  to  provide 
all  needed  public  revenues,  municipal,  county  and  national,  there 
is  no  doubt. 

From  the  Single  Tax  we  may  expect  these  advantages : 

1.  It  would  dispense  with  the  entire  army  of  tax  gatherers 
and  other  officials  which  present  taxes  require,  and  place  in 
the  treasury  a  much  larger  proportion  of  what  is  taken  from  the 
people,  while,  by  making  government  simpler  and  cheaper,  it 
would  tend  to  make  it  purer.  It  would  get  rid  of  taxes  which 
necessarily  promote  fraud,  perjury,  bribery  and  corruption, 
which  lead  men  into  temptation,  and  which  tax  what  the  nation 
can  least  afford  to  spare — honesty  and  conscience.  Since  land 
lies  out  of  doors  and  cannot  be  removed,  and  its  value  is  the 
most  readily  ascertained  of  all  values,  the  tax  to  which  we 
would  resort  can  be  collected  with  the  minimum  of  cost  and 
the  least  strain  on  public  morals. 

2.  It  would  enormously  increase  the  production  of  wealth — 

(a)  By  the  removal  of  Jhe  burdens  that  now  weigh  upon 
industry  and  thrift.  If  we  tax  houses,  there  will  be  fewer 
and  poorer  houses;  if  we  tax  machinery,  there  will  be  less 
machinery;  if  we  tax  trade,  there  will  be  less  trade;  if  we  tax 
capital,  there  will  be  less  capital;  if  we  tax  savings,  there  will 
be  less  savings.  All  the  taxes  therefore,  that  we  would  aboHsh 
are  taxes  that  repress  industry  and  lessen  wealth.  But  if  we 
tax  land  values,  there  will  be  no  less  land. 

(b)  On  the  contrary,  the  taxation  of  land  values  has  the 
effect  of  making  land  more  easily  available  by  industry,  since  it 
makes  it  more  difficult  for  the  owners  of  valuable  land,  which 
they  themselves  do  not  care  to  use,  to  hold  it  idle  for  a  larger 
future  price.  While  the  abolition  of  taxes  on  labor  and  the 
products  of  labor  would  free  the  active  elements  of  production, 
the  taking  of  land  values  in  taxation  would  free  the  passive 
elements  by  destroying  speculative  land  values,  and  preventing 
the  holding  out  of  use  of  land  needed  for  use.  If  any  one 
will  but  look  around  today  and  see  the  unused  or  but  half  used 
land,  the  idle  labor,  the  unemployed  or  poorly  employed  capital, 
he  will  get  some  idea  of  how  enormous  would  be  the  production 
of  wealth  were  all  the  forces  of  production  free  to  engage. 


120  SELECTED    ARTICLES 

(c)  The  taxation  of  the  process  and  production  of  labor 
on  the  one  hand,  and  the  insufficient  taxation  of  land  values 
on  the  other  produces  an  unjust  distribution  of  wealth, 
which  is  building  up  in  the  hands  of  a  few,  fortunes  more 
monstrous  than  the  world  has  ever  before  seen,  while  the 
masses  of  our  people  are  steadily  becoming  poorer.  These 
taxes  necessarily  fall  on  the  poor  more  heavily  than  on  the 
rich ;  by  increasing  prices  they  necessitate  larger  capital  in  all 
business  and  consequently  give  an  advantage  to  large  capitals ; 
and  they  give,  and  in  some  cases  are  designed  to  give,  special 
advantages  and  monopolies  to  combinations  and  trusts.  On  the 
other  hand  the  insufficient  taxation  of  land  values  enables  men 
to  make  large  fortunes  by  land  speculation  and  the  increase 
in  ground  values — fortunes  which  do  not  represent  any  addition 
by  them  to  the  general  wealth  of  the  community,  but  merely  the 
appropriation  by  some  of  what  the  labor  of  others  creates. 

This  unjust  distribution  of  w'ealth  develops,  on  the  one 
hand  a  class  idle  and  wasteful,  because  they  are  too  rich,  and  on 
the  other  hand  a  class  idle  and  wasteful,  because  they  are  too 
poor — it  deprives  them  of  capital  and  opportunities  which 
would  make  them  more  efficient  producers.  It  thus  greatly 
diminishes  production. 

(d)  The  unjust  distribution  which  is  giving  us  the  hun- 
dredfold millionaire  on  the  one  side  and  the  tramp  and  pauper 
on  the  other  generates  thieves,  gamblers,  social  parasites 
of  all  kinds,  and  requires  large  expenditures  of  money  and  energy 
in  watchmen,  policemen,  courts,  prisons  and  other  means  of 
defense  and  repression.  It  kindles  a  greed  of  gain  and  a  wor- 
ship of  wealth,  and  produces  a  bitter  struggle  for  existence 
which  fosters  drunkenness,  increases  insanity  and  causes  men 
whose  energies  ought  to  be  devoted  to  honest  production  to 
spend  their  time  and  strength  in  cheating  and  grabbing  from 
each  other.  Besides  the  moral  loss,  all  this  involves  an  enormous 
economic  loss   which  the  Single   Tax   would  save. 

(e)  The  taxes  we  would  abolish  fall  most  heavily  on  the 
poorer  agricultural  districts,  and  thus  tend  to  drive  popu- 
lation and  wealth  from  them  to  the  great  cities.  The  tax  we 
would  increase  would  destroy  that  monopoly  of  land  which  is 
the  great  cause  of  that  distribution  of  population  which  is 
crowding  people  too  closely  together  in  some  places  and  scatter- 


SINGLE   TAX  121 

ing  them  too  far  apart  in  other  places.  Families  live  on  top  of 
one  another  in  cities  because  of  the  enormous  speculative  prices 
at  which  vacant  lots  are  held.  In  the  country  they  are  scattered 
too  far  apart  for  social  intercourse  and  convenience,  because 
instead  of  each  taking  what  land  he  can  use,  every  one  who 
can,  grabs  all  he  can  get  in  the  hope  of  profiting  by  the  increase 
of  value,  and  the  next  man  must  pass  further  on.  Thus  we 
have  scores  of  families  living  under  a  single  roof,  and  other 
families  living  in  dugouts  on  the  prairies  afar  from  neighbors- 
some  living  too  close  to  each  other  for  moral,  mental,  or 
physical  health,  and  others  too  far  separated  for  the  stimulating 
and  refining  influences  of  society.  The  wastes  in  health,  in 
mental  vigor  and  in  unnecessary  transportation  result  in  great 
economic  losses  which  the  Single  Tax  would  save. 

These  are  the  fundamental  reasons  for  which  we  urge  the 
Single  Tax,  believing  it  to  be  the  greatest  and  most  funda- 
mental of  all  reforms.  We  do  not  think  it  will  change  human 
nature.  That,  man  can  never  do;  but  it  will  bring  about  condi- 
tions in  which  human  nature  can  develop  what  is  best,  instead 
of,  as  now  in  many  cases,  what  is  worst.  It  will  permit  such 
enormous  production  of  wealth  as  we  can  now  hardly  conceive. 
It  will  secure  an  equitable  distribution.  It  will  solve  the  labor 
problem,  and  dispel  the  darkening  clouds  which  are  now  gather- 
ing over  the  horizon  of  our  civilization.  It  will  make  undeserved 
poverty  an  unknown  thing.  It  will  check  the  soul-destroying 
greed  of  gain.  It  will  enable  men  to  be  at  least  as  honest,  as 
true,  as  considerate  and  as  high-minded  as  they  would  like  to  be. 
It  will  remove  temptation  to  lying,  false  swearing,  bribery  and 
law-breaking.  It  will  open  to  all,  even  to  the  poorest,  the 
comforts  and  refinements  and  opportunities  of  an  advancing 
civilization.  It  will  thus,  so  we  reverently  believe,  clear  the 
way  for  the  coming  of  that  kingdom  of  right  and  justice,  and 
consequently  of  abundance  and  peace  and  happiness,  for  which 
the  Master  told  His  disciples  to  pray  and  work.  It  is  not 
because  it  is  a  promising  invention  or  cunning  device  that  we 
look  for  the  Single  Tax  to  do  all  this ;  it  is  because  it  involves  a 
conforming  of  the  most  fundamental  adjustments  of  society 
to  the  supreme  law  of  justice  because  it  involves  the  basing  of 
the  most  important  of  our  laws  on  the  principle  that  we  should 
do  to  others  as  we  w^ould  be  done  by. 


NEGATIVE  DISCUSSION 

Single  Tax  Explained:  Summary,  Pages  24-8. 
George  Fallon. 

The  Fels  Fund  Commission  is  the  originator  of  the  present 
Single  Tax  movement  in  this  country. 

The  Referendum  League  and  the  Equitable  Taxation  League 
are  subsidiary  organizations  of  the  Fels  Fund  Commission, 
and  these  subsidiary  organizations  are  officered  by  the  same 
men. 

The  Referendum  League  four  years  ago  promoted  and  were 
successful  in  having  Initiative  and  Referendum  adopted  in 
Missouri.  Initiative  was  the  first  step  towards  Single  Tax, 
being  promoted  for  that  purpose,  and  therefore,  the  first  step 
towards  the  confiscation  of  land  in  Missouri. 

In  advocating  Single  Tax  in  Missouri,  the  Fels  Fund  Com- 
mission is  not  simply  interested  in  the  state's  system  of  taxation, 
for  few  of  these  people  have  any  property  interest  in  the  state. 
Probably  some  members  of  the  Commission  have  never  been 
in  the  state.  The  funds  provided  for  the  expense  of  this 
Commission  and  its  subsidiary  organizations  are  largely,  and 
almost  altogether,  provided  by  men  living  outside  of  Missouri. 
The  same  thing  may  be  said  as  to  the  state  of  Oregon,  the  city 
of  Seattle,  and  other  places  where  this  Commission  is  trying  to 
have  Single  Tax  adopted. 

The  question  naturally  arises.  Why  then  is  this  Commission 
interested  in  a  system  of  taxation  in  Missouri  and  other  places? 
The  reason  is  obvious  :  They  seek  to  make  use  of  this  necessary 
expense,  taxation,  by  having  it  placed  on  land  without  limita- 
tion, to  gradually  destroy  the  selling  or  commercial  value  of 
land.  In  doing  so,  they  make  various  side  arguments  in 
support  of  Single  Tax  to  accomplish  this  ulterior  purpose. 
They  justify  this  Single  Tax  attempt  to  destroy  the  commercial 
value  of  land  by  claiming  that  in  placing  the  burden  of  taxation 


124  SELECTED    ARTICLES 

on  land,  the  incentive  for  any  one  to  retain  possession  of  any 
more  land  than  they  can  properly  use,  would  be  removed.  Single 
Taxers  believe  there  is  land  enough  for  the  actual  needs"  of  all 
the  people.  They  claim  that  land  belongs  to  the  community  as 
a  whole,  and  that  any  one  wanting  the  exclusive  use  of  land 
should  pay  the  economic  rent,  or  rental  value,  into  the  public 
treasury  for  the  use  of  the  government.  The  Single  Taxer 
claims  that  in  the  state  appropriating  to  its  use  economic  rent, 
Nature's  wealth  will  be  made  use  of  for  all,  and  that  no  govern- 
ment should  seek  to  attempt  to  provide  for  its  expenses  by 
taxing  any  kind  of  wealth  or  property  that  is  created  by  its 
citizens,  until  they  have  first  exhausted  rent  from  land. 
i^The  Single,  Taver  seem.s  ta  overlook  the  fact  that  the  public, 
through  their  government,  sold  out  and  out  to  its  citizens  the 
public  domain,  that  land  has  passed  from  one  person  to  another, 
generally  at  an  increased  price,  and  that  the  present  owner  of 
land  has  paid  the  increased  price  to  individual  members  of 
society  who  have  heretofore  owned  the  land.  This  increased 
price  is  what  the  Single  Taxer  terms  "increment,"  and  economic 
rent  might  be  properly  termed  the  interest  on  increment ;  so 
that  the  individual  members  of  society  having  as  heretofore 
said,  received  from  time  to  time  the  increment  to  land,  final 
payment  having  been  made  by  the  present  owners,  it  would 
seem,  therefore,  that  as  individual  members  of  society  have 
already  been  paid  for  increment,  the  public,  through  their  gov- 
ernment, having  sold  the  land  out  and  out,  society  is  not 
entitled  to  rent. 

The  proposed  change  in  our  system  of  tajcatioB  will  not 
enable  any  one  TcTlicquire  land  any  bett^£_or  any  easier  than  it 
can  now  be  acquired.  If  a  person  desires  a  lot  for  its  site 
value  or  land  for  agricultural  purposes,  he  can  get  either,  and 
without  having  to  pay  any  higher  rent  to  the  present  owner  of 
land  than  what  they  would  have  to  pay  to  the  state  in  economic 
rent  for  the  use  of  the  same  lot  or  farm ;  for,  both  values  are 
fixed  by  llic  same  rule;  that  is,  what  the  exclusive  use  of  a  lot 
or  a  farm  is  worth.  But  there  is  this  difference:  The  present 
owner  could  sell  land  out  and  out  or  lease,  as  may  be  desired, 
at  an  agreed  definite  rental  value,  for  one  or  a  stated  number 
of  years.  A  lessee  would  then  know  absolutely  how  many  years 
he  could  occupy  the  land  and  just  what  he  would  have  to  pay 


SINGLE   TAX  125 

each  year.  Under  Single  Tax,  however,  if  he  occupied  a  lot  or 
a  farm,  he  would  not  know  what  rent  he  would  have  to  pay 
one  year  with  another.  The  taxes  might  be  so  high  that  he 
would  be  unable  to  pay  them  from  the  uses  he  was  making  of 
the  lot  or  farm.  While  there  was  an  uncertainty  as  to  what 
the  state  was  going  to  demand  in  taxes  each  year,  improvements 
would  of  necessity  be  prevented. 

The  following  are  the  present  sources  of  revenue  which 
would  be  materially  effected  by  the  adoption  of  the  Single  Tax 
Amendments : 

First — Tax  on  land. 

Second — Tax  on  improvements. 

Third — Tax  on  personal  property. 

Fourth — License  and  occupation  tax. 

Fifth— Poll  tax. 

Sixth — Special   Improvement  tax. 

Under  Single  Tax,  class  i  (land)  would  have  to  pay  the 
additional  taxes  paid  by  classes  2,  3,  4,  5  and  6.  In  cities  and 
municipalities  this  entire  tax  must  be  met  or  provided  for  from 
rent  on  buildings  or  impiievements  and  the  tenant  must  pay 
this  increased  rent,  so  that  rent  can  not  be  reduced  under  Single 
Tax  but  must  be  increased. 

Why  should  we,  by  constitutional  amendments,  deprive  our- 
selves of  the  taxes  on  classes  2,  3,  4,  5  and  6,  five  important 
resources  of  revenue,  when  Nation,  state  and  city  are  ever 
searching  for  additional  sources  of  revenue?  Why  repeal  the 
constitutional  limitation  on  rates  of  taxation?  W^hy  close,  bar 
and  seal  the  door  of  hope  for  holding  down  the  tax  rate? 

Single  Tax  would  not  stimulate  building  in  cities,  because 
the  increased  tax  would^JiRyp.J:':^  bp  mpf^in  the  form  of_  an 
increased  charge.  ^THsincreased  tax  would  be  far  in  excess 
of  the  pTesent  amount  of  taxes  now  paid,  on'gromKT  and  build- 
ing, plus  the  interest--Qii  the  money  necessary  to  buy  the  land. 

The  demands  of  state,  county,  district  and  city  are  inex- 
orable; they  must  be  paid.  If,  for  any  reason,  the  owner  of  a 
building  should  be  deprived  of  his  income,  (by  loss  of  tenants 
or  otherwise)  it  would  be  but  a  question  of  time  when  he  would 
lose  his  property  from  this  largely  increased  burden  under 
Single  Tax,  losing  both  his  lot  and  his  improvements.  This 
would  make  investment  in  improvements  extra  hazardous. 


126  SELECTED   ARTICLES 

y 

Agriculture  would  not  be  benefitted  by  confiscating  to  the 
state's  use,  the  rent  of  land  and  the  destroying  of  the  invested 
interest  in  land;  for,  -while  it  is  true  land  cannot  be  removed 
from  the  state,  the  farmer  can  (and  no  doubt  would)  leave  the 
state  and  go  to  where  he  could  and  would  receive  all  that  he 
now  receives,  which  is  all  that  the  land  will  produce.  Therefore, 
agriculture  will  not  be  benefitted. 

Manufacturing  would  not  be  benefitted  within  the  state,  be- 
cause manufacturing  depends  upon  prosperity,  and  agriculture  is 
the  foundation  and  source  of  prosperity. 

The  cost  of  living  cannot  be  cheapened  by  increasing  the 
taxes  on  an  industry  (agriculture)  which  produces  the  neces- 
saries of  life. 

Therefore,  rent  would  be  increased  instead  of  decreased,  im- 
provements would  be  retarded  rather  than  encouraged,  agricul- 
ture would  be  enslaved  rather  than  benefitted,  manufacturing 
would  be  handicapped  instead  of  stimulated,  the  cost  of  living 
would  be  increased  instead  of  decreased  under  Single  Tax, 
while  at  the  same  time  this  iniquitous,  treasonable  and  cruel 
Single  Tax  would  surely  and  certainly  result  finally  in  confiscation 
of  land  which  would  mean,  to  many  thousands  of  our  people,  the 
loss  of  the  net  earnings  and  rainy-day-savings  of  a  life  time.  All 
of  this  loss  and  sorrow  and  trouble  resultant  from  Single  Tax 
would  come  without  any  corresponding  benefit  to  the  people — the 
only  persons  who  would  be  benefitted  would  be  a  few  Sh^-locks 
and  misers. 

If  neither  agriculture,  manufacturing,  improvements  or  rent- 
ers are  to  be  benefitted,  if  the  cost  of  living  is  to  be  increased, 
and  at  the  same  time  billions  of  dollars  of  wealth  of  a  large 
number  of  our  citizens  would  be  destroyed,  without  any  corre- 
sponding benefit  to  the  rest  of  the  citizens  of  the  state,  confisca- 
tion of  land  is,  therefore,  a  fool,  fanatical  and  robbing  proposi- 
tion and  "Fool,  Fanatic  and  Robber"  should  be  branded  on  the 
epidermis  of  those  advocating  Single  Tax,  and  they  should  be 
either  restrained  from  running  at  large  or  be  driven  to  the  desert 
and  allowed  to  die. 


SINGLE   TAX  127 

Atlantic    Monthly.     13:27-37.     January,    1914. 
Case  Against  The  Single  Tax,     Alvin  Saunders  Johnson. 

Land-values  in  the  United  States  are  conservatively  estimated 
at  fifty  billion  dollars — not  much  less  than  one  half  of  the  total 
private  wealth  of  the  country.  The  value  of  agricultural  lands 
represents  about  three  fifths  of  this  vast  sum.  The  remaining 
two  fifths  covers  the  value  of  mines  and  forests,  railway  rights 
of  way,  water-powers,  and  urban  business  and  dwelling  sites. 
The  earning  power  attached  to  these  land-values  must  amount 
to  between  two  and  two  and  a  half  billion  dollars  annually.  This 
is  practically  one  tenth  of  our  aggregate  private  incomes,  and, 
if  appropriated  by  the  state,  would  cover  adequately  all  our  pub- 
lic needs;  provided,  of  course,  that  the  public  can  manage  the 
lands  as  efficiently  as  they  are  now  managed  by  their  private 
owners. 

The  farm  lands  of  the  United  States  are  worth  thirty  billion 
dollars,  exclusive  of  all  improvements.  Two  thirds  of  these  lands 
are  owned  by  their  cultivators,  who  number  four  million,  and 
whose  holdings  average  five  thousand  dollars  in  value.  Men  of 
this  class  are  neither  very  rich  nor  very  poor;  few  of  them  have 
wealth,  including  land  and  chattels,  valued  at  less  than  five  thou- 
sand or  more  than  a  hundred  thousand  dollars.  The  remaining 
third  of  the  farm  lands  is  cultivated  by  tenants.  The  owners  are 
of  many  different  classes:  active  farmers  who  have  acquired 
lands  at  a  distance;  retired  farmers;  the  business  and  professional 
men  of  the  towns  and  villages  who  have  purchased  farms  as  a 
secure  investment  or  as  a  retreat  in  old  age.  In  the  newer  sec- 
tions, where  agricultural  land  may  be  expected  to  advance  rapidly 
in  price,  there  are  a  few  very  large  estates ;  but  this  condition 
is  everywhere  recognized  to  be  transitional.  Farm  lands  cannot 
normally  be  a  favorite  investment  with  men  of  great  wealth. 

Practically  the  entire  body  of  our  agricultural  lands,  then, 
is  in  the  possession  of  the  middle  class.  City  and  town  lands 
are  not  so  widely  distributed.  As  an  instance  of  concentration 
of  ownership,  we  have  the  Astor  estate,  which  looms  mountain- 
high  in  Single-Tax  discussion.  We  have  other  large  fortunes 
in  city  realty.  Nevertheless,  not  more  than  fifteen  per  cent  of 
our  millionaires  have  the  bulk  of  their  fortunes  invested  in  land. 
Despite  the  evidences  of  concentration  in  New  York  and  a  few 


128  SELECTED   ARTICLES 

of  our  other  largest  cities,  we  are  justified  in  regarding  urban 
land  as  prevailingly  a  middle-class  investment.  Mines,  forests, 
water-powers,  and  railway  rights  of  way  are  held,  as  a  rule, 
by  large  corporations;  and  while  there  are  many  instances  of 
the  wide  distribution  of  their  shares,  we  may  safely  assume  that 
the  majority  interest  is  held  by  the  very  rich. 

As  the  foregoing  review  indicates,  the  greater  part  of  the 
land-values  which  it  is  proposed  to  confiscate  is  the  property 
of  the  middle  class.  Middle-class  holdings  cannot  possibly  be 
less  than  three  fifths  of  the  total,  and  may  conservatively  be  put 
as  high  as  four  fifths  of  it. 

Not  only  is  it  true  that  land  Is  prevailingly  a  middle-class 
investment,  but  it  is  also  true  that  it  is  probably  the  chief  element 
in  the  property  of  this  class.  Men  of  moderate  means  own  be- 
tween thirty  and  forty  billion  dollars'  worth  of  land ;  it  is  highly 
improbable  that  they  own  an  equal  amount  of  wealth  in  other 
forms.  And  current  economic  forces  are  increasing  the  de- 
pendence of  the  middle  class  upon  the  land.  Industrial  concen- 
tration is  rapidly  transforming  the  small  business  man  into  a 
shareholder  and  an  employee.  As  a  shareholder  he  sees  his  hold- 
ings shrink  or  expand  under  market  influences  which  he  cannot 
so  easily  forecast  as  can  the  man  of  large  wealth.  Stocks  which 
he  has  purchased  at  high  prices  in  a  period  of  inflation  of  values 
he  is  likely  to  sell  at  low  prices  in  a  panic,  thus  forfeiting  a  part 
of  his  possessions  to  the  men  who  are  in  a  better  position  to  meet 
fluctuations  than  he.  Land,  on  the  other  hand,  is  more  easily 
managed  in  small  parcels  than  in  large.  There  are  no  terrifying 
fluctuations  in  its  value.  It  is,  moreover,  not  a  sufficiently  pro- 
ductive investment  to  tempt  men  of  large  means.  Accordingly 
it  is  the  one  investment  that  the  middle  class  can  hold  against 
the  encroachments  of  the  rich.  Indeed,  the  rich  cannot  hold  it 
against  the  middle  class,  except  through  the  powerful  traditions 
of  an  ancient  landed  .aristocracy,  forfeited,  at  times,  by  legal 
institutions,  such  as  entail. 

It  has  been  urged  by  Singlc-'I'axcrs  tliat  the  relief  from  other 
forms  of  taxation  which  would  follow  upon  the  introduction 
of  the  Single  Tax  would  amply  compensate  the  man  of  modest 
means  for  the  loss  of  his  land.  This  contention  obviously  in- 
volves an  astonishing  overestimate  of  the  burdens  of  ordinary 
taxation.    All  taxes,  other  than  those  on  land,  aggregate  less  than 


SINGLE   TAX  129 

one  half  of  the  land-rent  enjoyed  by  the  middle  class.  And  of 
these  taxes,  not  more  than  a  third  falls  upon  the  middle-class 
landowners.  This  class  cannot  therefore  recover,  in  the  way 
of  relief  from  ordinary  taxation,  more  than  one  sixth  of  the  loss 
imposed  upon  it  by  the  tax. 

It  is  true  that  the  middle-class  land-owner  bears,  in  addition 
to  ordinary  taxation,  the  burden  of  high  prices  resulting  from 
the  protective  system.  This  burden,  however,  is  the  price  which 
the  American  people  chooses  to  pay  for  an  acceleration  of  the 
rate  of  industrial  development.  Protection  is  no  essential  element 
in  the  existing  financial  order ;  any  financier  could  devise  for  the 
United  States  a  revenue  system  containing  no  element  of  protec- 
tion, w^hich  would  be  both  adequate  and  economical.  And  any 
protectionist  could  devise  restraints  upon  foreign  tirade  even 
under  the  Single  Tax.  There  is  accordingly  no  escape  from 
the  conclusion  that  all  that  the  Single-Taxers  can  honestly  prom- 
ise the  middle-class  landowner  is  a  relief  of  one  dollar  in  taxation 
for  every  six  dollars  of  income  confiscated.  - 

The  Single  Tax  is,  then,  essentially  a  device  for  the  spolia- 
tion of  th^  middle  class.  In  justice  to  the  adherents  of  the 
doctrine,  however,  it  must  be  said  that  they  are  not,  as  a  rule, 
aware  of  this  fact.  Few  of  them  have  ever  made  any  effort  to 
ascertain  the  existing  distribution  of  the  property  which  they 
seek  to  confiscate.  Those  who  do  recognize  the  facts  of  the  dis- 
tribution of  landed  property  hold  nevertheless  that  the  gains  to 
society  at  large  will  be  sufficient  to  cover  all  costs.  The  poor, 
they  urge,  will  gain  what  the  middle  class  loses. 

If  the  poor  are  to  benefit  from  the  Single  Tax,  it  must  be 
either  through  a  reduction  in  the  cost  of  living  or  through  a 
rise  in  wages.  The  removal  of  the  custom  and  excise  duties 
would  doubtless  reduce  the  price  of  many  articles  of  consump- 
tion. We  should  still,  however,  have  carriers  charging  what  the 
traffic  will  bear,  and  producers  and  retailers  working  under 
gentlemen's  agreements.  These,  we  may  assume,  would  absorb 
no  small  part  of  the  slack  created  by  the  remission  of  duties. 
Whatever  benefit  came  from  the  abolition  of  the  duty  on  hides, 
under  the  Payne-Aldrich  act,  was  wholly  absorbed  before  it 
reached  the  buyer  of  shoes.  The  remission  of  the  special  taxes 
on  tobacco,  after  the  Spanish  War,  had  no  perceptible  effect  on 
retail  prices.    Not  increased  wages,  but  increased  money  profits, 

11 


130  SELECTED   ARTICLES 

would  be  the  most  prominent  effect  of  the  Single  Tax.  That 
this  would  be  the  probable  result  will  appear  to  any  one  who  will 
put  the  problem  in  its  simplest  terms.  An  annual  income  of  two 
billion  dollars  is  to  be  torn  from  the  grasp  of  the  middle  class. 
There  is  no  automatic  device  for  distributing  this  splendid  spoil; 
the  very  poor  and  the  very  rich  will  have  to  strive  for  it.  Who 
will  get  it? 

The  foregoing  analysis  will  appear  to  the  convinced  Single- 
Taxer  as  both  unfair  and  inadequate,  in  that  it  is  confined  to 
conditions  as  they  are,  and  takes  no  account  of  the  wrongs  of  the 
past  and  the  possibilities  of  the  future.  Whatever  class  holds  the 
land  now  holds  unjustly,  according  to  the  Single-Taxers.  And 
whatever  class  may  have  to  be  despoiled,  its  present  pains  are 
of  no  weight  when  set  against  the  infinite  future  advantages  of  a 
society  freed  from  the  burden  of  parasitism. 

We  may  ignore  the  contention  that  land  cannot  properly  be 
private  property  because  its  value  is  not  traceable  to  labor.  At- 
tempts to  reduce  values  to  a  labor  basis  can  lead  to  only  one 
conclusion:  communism.  The  Single-Taxers  count  themselves 
formidable  antagonists  of  Socialism,  and  cannot  afford  to  coquet 
with  the  labor-property  premise.  Furthermore,  we  need  not 
trouble  ourselves  with  the  fact  that  many  land-titles  have  origi- 
nated in  force  or  in  usurpation.  Too  many  other  titles  have 
originated  in  similar  processes,  and  the  common  sense  of  man- 
kind admonishes  us  that  all  social  justifications  lie  in  the  future, 
not  in  the  past.  The  kernel  of  the  Single-Taxers'  attack  upon 
land-values  lies  in  the  idea  that  such  values  are  unearned.  And 
this  means  either  that  they  have  been  acquired  with  less  than 
normal  effort  and  sacrifice,  or  that  such  efforts  and  sacrifices  as 
have  been  directed  toward  their  acquisition  have  been  barren 
of  results  useful  to  society. 

It  is  a  widely  prevalent  belief  that  investments  in  land  have 
been  exceptionally  profitable  in  the  past.  On  our  own  frontier, 
lands  were  secured  from  the  government  at  a  very  low  price,  or' 
perhaps  for  only  a  nominal  fee.  Such  lands  have  risen  steadily, 
and  it  is  natural  to  suppose  that  these  advances  in  value  have 
placed  their  fortunate  possessors  in  the  position  of  a  privileged 
class.  The  landowners,  according  to  a  common  formula,  have 
enjoyed  two  incomes:  the  rent  of  their  land,  and  the  advance 
in  its  value. 


SINGLE   TAX  131 

If  this  view  were  just,  it  would  be  hard  to  account  for  the 
fact  that  in  a  new  agricultural  community  it  is  not  the  landown- 
ers, with  their  two  incomes,  who  attract  attention  by  their 
rapid  accumulation  of  wealth,  but  the  bankers,  the  grain  and 
stock-buyers,  the  grocers  and  lumber-dealers,  men  who  have  to 
content  themselves  with  the  single  income  of  profit.  What  the 
landowners  have  received  is  a  dual  income,  not  a  double  one. 
If  we  have  found  business  men  willing  to  invest  their  capital 
in  trade  and  industry,  the  only  satisfactory  explanation  of  the 
fact  is  that  they  believed  that  the  annual  profits  of  enterprise 
are  superior  to  all  the  gains  from  land.  And  this,  no  doubt, 
is  the  rule.  As  a  consequence  of  the  universal  belief  that  land- 
values  will  rise,  land  is  commonly  overcapitalized.  Men  establish 
themselves  in  unsettled  regions  long  before  general  economic 
conditions  afford  them  a  return  commensurate  with  their  toil  and 
privations ;  after  many  years  of  waiting  they  sell  their  holdings 
at  prices  which  are  seldom  an  adequate  reward  for  their  own 
labors.  Nevertheless,  these  prices  are  almost  always  in  excess 
of  the  capital  value  of  the  annual  returns  from  the  land.  The 
buyers  look  to  the  "unearned  increment"  to  recoup  them  for  the 
loss  of  income  involved  in  tying  up  their  capital  unproductively. 
From  a  personal  point  of  view,  the  "unearned  increment"  consists 
of  the  wages  of  pioneering  together  with  interest  on  capital  sunk 
in  the  price  of  the  soil.  Both  the  wages  and  the  interest  are,  as 
a  rule,  below  the  normal  rate.  Pioneers  and  buyers  of  land 
are  not  of  our  shrewd  business  men,  but  are  persons  of  modest 
means,  who,  like  the  land  reformers,  vastly  overestimate  the 
profits  of  landed  investments. 

It  is  of  course  true  that  many  instances  may  be  cited  of 
astonishing  advances  in  land-values.  Every  one  knows  of  city 
lands  that  have  doubled  in  value  in  a  single  year.  Sometimes 
such  advances  are  confined  to  particular  districts,  affected  by 
new  public  improvements ;  sometimes  they  are  fairly  uniform 
throughout  a  city,  as  in  a  "boom  town"  of  the  West.  It  may  be 
a  wise  policy  to  make  such  chance  gains  contribute  to  the  public 
treasury,  just  as  it  may  be  a  wise  policy  to  place  a  tax  upon  other 
abnormally  successful  speculative  transactions.  There  is,  how- 
ever, no  need  of  invoking  the  Single  Tax  in  support  of  such  a 
policy.  It  finds  abundant  support  in  the  accepted  theories  of 
finance. 


132  SELECTED   ARTICLES 

Recognition  of  the  fact  that  excessive  speculative  gains  do 
occasionally  appear  in  the  real-estate  field  should  not,  however, 
lead  us  to  the  conclusion  that  all  advances  in  real  estate  are  of 
such  character.  On  much  the  greater  part  of  our  lands,  urban  as 
well  as  agricultural,  the  "unearned  increment,"  together  with  the 
rent,  is  hardly  sufficient  to  make  up  a  normal  return  on  the  capi- 
tal invested  in  the  land.  If,  then,  there  is  a  reason  for  taxing 
away  the  future  "unearned  increment,"  that  reason  does  not  con- 
sist in  the  fact  that  the  landowners  form  a  privileged  class. 

It  can  hardly  be  denied  that  the  landowners  as  a  class  have 
acquired  the  values  in  their  possession  at  a  cost  in  labor  and 
sacrifice  fairly  comparable  with  those  who  have  been  rewarded 
by  property  of  equal  value  in  other  forms.  If,  however,  no  one 
has  been  willing  to  incur  the  sacrifice  necessary  to  acquire  a 
grist-mill,  we  should  have  had  no  grist-mills.  If  no  one  had  ever 
incurred  sacrifice  to  acquire  title  to  land,  should  we  not  still 
have  the  land?  It  is  such  a  comparison  as  this  that  leads  to 
the  frequent  assertion  that  the  private  ownership  of  land  exer- 
cises no  useful  social  function. 

The  issue  looks  simple,  at  first  sight.  Private  enterprise  made 
the  mill;  private  enterprise  did  not  make  the  land.  But  the  con- 
trast is  fallacious.  A  wilderness,  however  fertile,  is  of  no  social 
significance.  The  land  that  serves  as  the  foundation  of  our 
economic  Hfe  is  the  land  under  the  plough  or  in  meadow  or 
pasture,  and  rendered  accessible  to  markets  by  highways,  canals, 
and  railroads.  If  we  had  administered  our  lands  from  the 
beginning  according  to  Single-Tax  principles,  when  would 
our  western  forests  have  been  cleared,  our  prairies  transformed 
into  fields  of  wheat  and  corn?  Not  in  decades,  but  in  cen- 
turies. 

There  was  a  time  when  the  typical  American  pioneer  sought 
land  that  was  free,  in  the  true  sense  of  the  term — land  which  he 
might  use  as  long  as  he  pleased  and  abandon  at  a  whim.  This 
man  did  not  seek  values,  nor  did  he  produce  them.  He  cleared 
the  land  of  game  and  Indians,  and  made  easier  the  path  of  the 
economic  pioneer,  the  man  who  put  the  land  under  cultivation 
and  made  it  yield  its  fruits,  not  for  his  benefit  alone,  but  also 
for  the  more  thickly  settled  East  and  for  the  countries  of  Europe. 
The  economic  pioneer  was  in  search  of  a  fortune.  He  would  not 
have  been  content  with  the  prospect  of  bare  wages,  in  the  form 


SINGLE  TAX  133 

of  the  raw  products  of  the  soil.  For  the  frontier  never  yielded 
wages  commensurate  with  its  hardships. 

It  was  not  free  land,  but  land  that  was  certain  to  rise  in  value, 
that  attracted  the  millions  of  men  from  our  own  East  and  from 
Europe  to  the  edge  of  civilization.  The  transformation  of  the 
Western  wilderness  into  an  empire  of  farms  was  the  work  of  the 
"unearned  increment."  One  who  wishes  to  see  the  unearned  in- 
crement performing  a  similar  work  to-day  has  only  to  visit  the 
Canadian  Northwest.  What  has  induced  the  hundreds  of  thou- 
sands from  our  own  comfortable  and  prosperous  Middle  West 
to  cross  the  border  and  quarter  their  families  in  pine  shanties 
on  the  blizzard-swept  plains?  The  lure  of  the  unearned  incre- 
ment. Lands  purchasable  at  ten  dollars  an  acre  which  may 
be  expected  to  rise  to  fifty  dollars. 

If  the  Single-Tax  principle  had  been  in  operation  from  the 
beginning  of  our  history,  what  would  have  been  the  course  of 
our  Western  development?  With  the  state  as  universal  land- 
lord, all  that  the  West  could  have  promised  the  settler  would 
have  been  the  wages  of  his  labor.  To  compensate  for  all  the 
sacrifices  involved  in  pioneer  life,  the  wages  would  have  had  to 
be  made  very  high.  And  this  means  that  the  opening  of  new 
lands  would  necessarily  have  waited  upon  the  time  when  the 
pressure  of  population  in  the  older  centres  and  the  increasing 
miseries  of  the  poor  should  expel  some  of  their  number  to  the 
frontier.  Under  such  a  condition  of  development,  Kentucky 
would  doubtless  still  be  a  dark  and  bloody  ground,  and  the 
Ohio  forests  a  haunt  of  outlaws.  Buffaloes  would  still  range 
the  Louisiana  Purchase,  and  the  Canadian  Northwest  would 
remain  for  several  centuries  to  come  an  asset  of  the  Hudson  Bay 
Company.  Slavery  would  still  be  the  most  prominent  feature 
of  our  social  system,  and  our  greatness  as  a  nation  would  be  a 
matter  for  future  ages  to  achieve. 

It  was  the  unearned  increment  which  opened  the  West  and 
laid  the  basis  for  our  present  colossal  industriahsm.  It  was 
the  unearned  increment  which  created  a  vast  surplus  of  food- 
products  and  raised  the  curse  of  periodic  famine  from  Western 
civilization.  The  exuberant  fertility  of  the  Mississippi  Valley 
lifted  millions  of  men  from  poverty  and  quickened  the  life  of 
the  whole  Occident.  There  are,  of  course,  those  who  will  say 
that  this  was  not  worth  while;  that  human  life  was  more  satis- 


134  SELECTED   ARTICLES 

fying  under  the  ancient  condition  of  well-defined  classes,  some 
secure  in  their  superiority,  others  inured  to  their  lot.  Such 
considerations  lie  entirely  beyond  the  scope  of  the  present  paper. 
All  that  is  necessary  for  our  purpose  is  to  indicate  that  the  un- 
earned increment— that  supposedly  functionless  element  in  our 
distributive  system— has  played  an  extraordinarily  active  part 
in  building  up  our  modern  industrialism. 

If  the  unearned  increment  has  already  completed  its  work, 
it  is,  perhaps,  the  natural  prey  of  a  state  which  recognizes  neither 
vested  interests  nor  the  claims  of  past  services  to  present  re- 
wards. Ethical  and  political  reasons  for  opposing  the  confiscation 
of  land-values  may  still  persist;  but  the  principal  economic 
ground  for  opposing  such  a  policy  falls  away  if  the  unearned 
increment  is  now  socially  inert.  If  our  lands  will  be  as  well 
cultivated,  our  cities  as  rapidly  improved,  under  the  Single  Tax 
as  they  are  under  existing  conditions,  we  cannot  say  that  the 
proposed  confiscation  is  economically  indefensible. 

American  agriculture  is  not  yet  ready  to  dispense  with  the 
unearned  increment.  Our  four  million  independent  farmers 
represent  the  more  intelligent,  the  more  efficient,  and  the  more 
provident  of  our  rural  population.  Able  men  among  the  ten- 
ants and  the  hired  laborers  are  only  transiently  in  those  classes : 
their  qualities  destine  them  to  become  independent  farmers. 
Now,  AN-iiat  are  the  annual  earnings  of  the  independent  farmer? 
On  an  average,  $600.  This  sum,  which  is  less  than  the  city 
laborer  of  equally  good  economic  quality  earns  with  his  bare 
hands,  includes  not  only  the  rew^ard  of  the  farmer's  labor,  but 
interest  on  a  capital,  in  land  and  improvements,  averaging  $7500. 
What  wonder  that  there  is  a  steady  movement  of  the  rural  pop- 
ulation to  the  cities?  The  fact  to  be  explained  is  that  the  move- 
ment is  not  universal. 

And  the  explanation  is  to  be  found  in  the  unearned  increment. 
To  his  meagre  $600  of  money  income  the  independent  farmer 
adds  the  increase  in  the  value  of  his  land.  This  item  he  usually 
overestimates,  and  thus  makes  out  of  it  a  powerful  motive  for 
remaining  on  the  land,  producing  wheat  and  meat  for  the  con- 
sumption of  the  cities.  However  high  the  present  prices  of 
food  may  seem  to  the  city-dweller,  they  are  not  so  high  as  they 
would  be  if  agricultural  products  were  not,  in  large  measure, 
a  by-product  of  the  unearned  increment. 


SINGLE   TAX  135 

Increase  in  the  value  of  land  cannot  continue  indefinitely  to 
supplement  the  farmer's  income.  In  parts  of  the  East  lands 
have  already  ceased  to  rise.  Those  are  the  regions  of  the 
abandoned  farms.  In  parts  of  the  Aliddle  West  lands,  while 
still  rising  slowly,  are  approaching  a  stationary  level.  Those  are 
the  regions  from  which  the  most  enterprising  men  are  emigrat- 
ing to  Canada,  where  the  promise  of  unearned  increment  is  still 
rich.  Sooner  or  later  practically  all  our  lands  will  cease  to  rise. 
When  we  shall  have  attained  to  this  condition  the  money  returns 
to  labor,  and  capital  in  agriculture  will  have  to  be  made  equal  to 
wages  and  interest  in  the  cities.  Or  rather,  agricultural  returns 
must  be  made  superior  to  those  attainable  in  the  cities,  to  com- 
pensate for  the  isolation  and  monotony  of  rural  life.  This 
readjustment  will  be  effected  through  advancing  prices  of  agri- 
cultural products  and  through  restricted  opportunity  in  the  cities. 

If  we  desire  to  enter  at  once  upon  this  process  of  readjust- 
ment, we  have  only  to  enact  the  Single  Tax.  The  more  enter- 
prising of  the  agricultural  population,  despoiled  of  their  prop- 
erty and  of  an  essential  part  of  their  income,  will  cease  to  pro- 
duce food  for  the  city  laborers,  and  will  enter  into  competition 
with  them  for  jobs.  What  will  follow  is  easy  to  forecast:  in- 
creasing misery  in  the  cities,  advancing  agricultural  prices,  and, 
in  the  end,  a  new  equilibrium.  Yet  the  Single  Tax  has  been 
seriously  advanced  as  a  sure  means  of  alleviating  poverty. 

In  recent  years  the  Single-Taxers  have  concentrated  their 
attacks  upon  urban  land-values.  These,  they  assert,  are  purely 
parasitic  and  act  as  a  dead  weight  upon  building  operations.  The 
grasping  landlord,  according  to  this  doctrine,  is  ultimately  re- 
sponsible for  the  congestion  of  the  slums,  and  hence  for  much 
of  the  vice  and  crime  of  the  city.  The  population  of  the  metro- 
politan district  of  New  York  is  increasing  at  the  rate  of  two  hun- 
dred thousand  a  year.  Every  person  in  this  vast  army  con- 
tributes something  to  land-values.  In  what  way  have  the  owners 
of  land  earned  this  additional  value?  Certainly,  there  appears 
to  be  ground  for  the  charge  of  parasitism. 

If  the  new  values  distributed  themselves  uniformly  among 
passive  landowners,  the  charge  of  parasitism  would  hold.  They 
do  not,  however,  distribute  themselves  uniformly.  Competing 
landowners  are  forced  to  struggle  for  them ;  and  the  struggle  is 
not  barren  of  social  gains.     There  are  clearly  defined  currents 


136  SELECTED   ARTICLES 

of  life  and  business  in  the  metropolitan  district,  and  no  man 
can  forecast  with  certainty  the  direction  they  will  take.  But  if 
provision  is  to  be  made  for  the  housing  of  the  new  population 
and  for  the  accommodation  of  the  new  business,  many  builders 
must  stake  their  money  upon  their  guesses  as  to  the  future  di- 
rection of  the  currents.  Otherwise  the  city  would  suffer  chroni- 
cally from  an  intolerable  congestion. 

Those  whose  guesses  prove  correct  find  their  buildings  oc- 
cupied at  high  rents,  or  salable  at  prices  in  excess  of  costs.  This 
means  that  an  "unearned  increment"  attaches  to  the  site,  since 
building  capital  itself  can  hold  abnormal  value.  Those  who  have 
guessed  wrong  must  content  themselves  with  "writing  off"  a  part 
of  their  capital.  Now,  it  is  proposed  by  the  Single-Taxers  to 
appropriate  to  the  state  the  fruits  of  building  speculations  that 
prove  successful,  while  leaving  to  private  enterprise  the  fruits 
of  unsuccessful  speculations.  And  on  such  a  basis  they  expect 
a  "boom"  in  building. 

There  is  no  difficulty  in  predicting  the  results  of  such  a  policy. 
Men  would  build  only  after  it  became  practically  certain  that 
their  buildings  would  be  in  demand.  Construction  would  follow 
increase  in  population,  instead  of  anticipating  it,  as  at  present. 
The  evils  of  over-building,  of  which  real-estate  journals  so  fre- 
quently complain,  would  be  eft'ectually  controlled.  But  these 
are  not  the  evils  which  chiefly  oppress  the  tenant  class  and  harass 
the  city  reformer. 

It  is  well  known  to  everyone  conversant  with  the  facts  of 
realty-promotion  that  it  is  in  the  "boom  towns"  and  the  active 
sections  of  a  large  city,  where  land-values  are  rising  rapidly, 
that  over-building  most  frequently  occurs.  Whence,  then,  do  the 
Single-Taxers  derive  their  doctrine  that  advancing  land-values 
not  only  do  not  hasten  the  progress  of  improvement,  but  actu- 
ally retard  it?  Not  from  observation,  but  from  theory.  And 
they  may  justly  demand  that  their  contentions  be  met  on  a 
rigorously  theoretical  ground. 

The  Single-Tax  theory  premises  vacant  land  advancing  in 
value  at  a  rate  corresponding  to  normal  interest  on  an  equiva- 
lent capital  investment.  Why  should  the  owner  of  such  land 
improve  it?  Most  of  the  vacant  land  in  cities  is  actually  increas- 
ing in  value  at  such  a  rate— a  fact  that  is  logically  deducible  from 
the   accepted   principles    of    real-estate   valuations.      Now,    have 


SINGLE   TAX  137 

we  not  here  an  explanation  of  the  fact  that  thousands  of  parcels 
of  land  in  our  cities  are  held  unimproved,  while  in  certain  other 
quarters  of  the  same  cities  human  beings  are  packed  ten  in  a 
room?     The  Single-Taxers  assert  that  we  have. 

If,  however,  we  examine  the  matter  closely,  we  shall  see 
that  while  there  is  nothing  to  compel  the  owner  of  such  land  to 
improve  it,  he  can  afford  to  do  so  the  moment  that  prospective 
rentals  will  cover  interest  on  his  building  capital  alone.  And 
there  is  no  conceivable  state  in  which  he  can  afford  to  improve 
if  the  rentals  will  pay  less  than  this.  He  cannot  do  this  even 
if  the  land  is  free,  without  selling-price  or  rent.  The  Single 
Tax  therefore  cannot  produce  a  state  more  favorable  for  build- 
ing than  that  which  exists  where  the  land  is  rising  at  the  rate  we 
have   assumed. 

If  a  builder  must  buy  land  which  is  not  rising,  he  cannot 
afford  to  build  unless  prospective  rentals  will  pay  interest  on 
his  land  investment  as  well  as  on  his  building  investment.  If  he 
builds  on  ground  leased  from  a  private  person  or  "single-taxed" 
by  the  state,  he  must  extort  from  his  tenants  rentals  covering 
both  the  ground-rent  and  interest  on  his  investment. 

The  Single-Taxers,  it  is  true,  promise  immunity  from  tax- 
ation of  the  building;  and  where  the  value  of  land  is  low,  this 
immunity  would  be  a  sufficient  offset  to  the  "unearned  increment" 
of  which  they  would  deprive  the  builder.  Where  the  land-value 
represents  a  large  part  of  the  total  investment,  as  in  most  of 
our  cities,  the  offset  would  be  insufficient.  An  honestly  ad- 
ministered Single  Tax  could  not  produce  conditions  so  favorable 
to  building  as  now  exist  wherever  land-values  are  rising  rapidly. 

It  is  almost  a  waste  of  time  to  inspect  the  Single-Tax  project 
for  destroying  the  slum.  It  is  the  value  of  land  that  forces 
the  city  builder  to  occupy  every  possible  foot  of  ground  space, 
to  pile  story  above  story,  to  subdivide  each  story  into  the  smallest 
apartments  and  rooms  that  can  be  tenanted  by  living  man.  It 
is  a  matter  of  indift'erence  whether  the  vahie  of  land  takes  the 
form  of  a  capital  sum,  as  is  now  commonly  the  case,  or  of  an 
annual  rental,  an  occasional  form  now,  which  would  be  universal 
under  the  Single  Tax.  The  reasons  for  economizing  ground 
space  are  the  same  in  either  case;  except  that  the  Single  Tax 
promises  immunity  from  taxation  on  the  building  and  so  would 
offer  an  inducement  to  covering  still  more  of  the  ground  space. 


138  SELECTED   ARTICLES 

and  pushing  the  stories  still  higher  toward  the  sky.  The  Single- 
Taxers  propose,  then,  to  relieve  urban  congestion  by  means 
which  would  increase  the  number  of  persons  to  be  sheltered  by 
each  unit  of  roof. 

Private  property  in  land,  as  we  have  seen,  serves  an  im- 
portant purpose  in  production,  so  long  as  land-values  continue 
to  advance.  Such  advances  cannot  continue  forever.  The  time 
will  come  when  agricultural  land  will  bear  a  constant  value, 
based  upon  its  annual  productive  capacity.  The  cities,  too,  will 
in  the  end  reach  the  limit  of  their  growth,  and  an  unearned  in- 
crement wnll  no  longer  attach  to  site-values.  When  such  a  time 
comes,  there  will  be  no  good  reason  why  the  state  should  not 
become  the  universal  landlord,  provided  that  it  has  evolved  to  the 
point  where  it  can  manage  so  colossal  a  landed  estate  more 
efficiently  than  can  private  landowners.  Just  as  there  will  be  no 
good  reason  why  the  state  should  not  take  over  the  railways, 
mines,  and  industries  of  the  nation  as  soon  as  it  is  able  to  ad- 
minister those  enterprises  more  effectively  than  private  business 
men.  It  may  be  noted  in  passing  that  the  administration  of  the 
land,  under  a  tenant  system,  would  represent  a  heavier  task  for 
the  state  than  the  administration  of  railways,  mines,  and  in- 
dustries combined. 

Let  us  assume,  however,  that  the  state  is  ready  to  take  over 
its  landed  domain.  Should  this  be  effected  through  confiscation, 
as  the  Single-Taxers  propose,  or  through  purchase?  The  pur- 
chase of  the  land  may  be  rejected  as  impracticable.  For  the 
present  price  represents  not  only  the  capital  value  of  its  rent,  but 
also  the  anticipated  value  of  all  the  unearned  increments  of  the 
future.  The  net  revenue  that  the  state  would  secure  from  its 
lands  w^ould  probably  never  equal  the  interest  on  the  public  debt 
created  in  the  process  of  acquiring  the  land. 

If  the  lands  are  to  be  confiscated,  the  act  must  be  justified 
by  its  social  consequences.  What  these  would  be  is  already 
sufficiently  clear.  The  proposed  land  reform  would  deprive  the 
middle  class  of  its  chief  possession:  the  possession  on  which 
its  economic  independence  mainly  rests.  And  this  would  mean, 
practically,  the  elimination  of  the  middle  class  as  a  political  factor. 

It  was  Aristotle  who  first  pointed  out  the  dependence  of 
political  stability  and  personal  freedom  upon  a  powerful  middle 
class.     To  the  present  day  no  authority  on  political  science  has 


SINGLE   TAX  139 

arisen  to  deny  the  existence  of  such  a  relation.  It  was  the  middle 
class  of  England  that  estabHshed  constitutional  liberty.  It  was 
the  middle  class  that  destroyed  the  ancien  regime  in  France  and 
laid  the  foundations  of  a  liberal  state.  Our  own  Constitution 
is  essentially  a  middle-class  document,  and  it  is  the  middle  class 
that  defends  it  against  attack. 

We  may  contrast  our  confidence  in  the  stability  of  our  own 
liberal  institutions  with  our  skepticism  of  attempts  to  introduce 
similar  institutions  in  countries  in  a  different  stage  of  social 
development.  It  is  hard  to  believe  that  constitutionalism  can  be 
more  than  a  name  in  Russia  and  Turkey,  or  that  democracy  in 
Mexico  can  signify  anything  but  a  cloak  for  force.  It  is  not 
that  we  doubt  the  political  capacity  of  Slavs  and  Moslems  and 
Mexicans.  But  those  nations  lack  the  chief  prerequisite  of  po- 
litical freedom  and  order :  a  vigorous  middle  class. 

Not  all  will  agree,  it  is  true,  that  the  liberal  regime  is  the 
best  conceivable  political  order.  The  Socialists  are  especially 
violent  in  their  attacks  upon  it.  And  every  Socialist  recognizes 
that  constitutionalism  and  free  enterprise  are  bound  up  with  the 
fortunes  of  the  middle  class.  Eliminate  the  middle  class,  and 
there  will  remain  no  serious  obstacle  to  the  progress  of  Socialism. 
Accordingly,  it  is  difificult  to  understand  the  impatience  which 
the  Sociahst  usually  manifests  toward  the  Single-Taxer.  The 
latter,  indeed,  is  not  a  Socialist,  but  he  is  laboring  valiantly  to 
produce  the  conditions  under  which  alone  Socialism  has  any 
chance  whatsoever  of  success.  Transform  our  four  milHon 
independent  farmers  into  tenants  of  the  state;  despoil  an  equal 
number  of  our  middle-class  townsmen  of  their  one  solid  posses- 
sion,  and  the  expropriation  of  the  remaining  private  owners  of 
property  will  be  easily  accomplished.  Despite  the  sentimental 
antipathies  of  their  respective  adherents,  then,  the  Single  Tax 
and  Socialism  are  closely  related.  Their  relation  is  that  of  means 
and  end. 


140  SELECTED   ARTICLES 

Seligman,  Edwin  R.  A.     Essays  in  Taxation. 

Chapter  IIL     The   Single  Tax.* 

The    General    Theory 

The  general  economic  theory  on  which  the  demand  for  the 
Single  Tax  is  based  may  be  summed  up  in  a  few  words.  Land  is 
the  creation  of  God;  it  is  not  the  result  of  any  man's  labor;  no 
one,  therefore,  has  a  right  to  own  land.  Increase  in  the  value 
of  land  is  due  mainly  to  the  growth  of  the  community;  like  the 
land  itself,  it  is  not  the  result  of  any  individual  effort;  it  is  an 
unearned  increment  which  properly  belongs  to  society.  More- 
over, private  property  in  land  is  undoubtedly  the  cause  of  all 
social  evils.  It  therefore  becomes  the  duty  of  the  government 
to  take  what  rightfully  belongs  to  the  whole  community.  Every 
one  may  still  retain  the  result  of  his  own  labor;  but  the  value 
of  the  bare  land,  the  economic  rent,  must  be  taken  for  the 
state.  In  this  way,  and  in  this  way  alone,  can  the  social  problem 
be  solved. 

In  order  to  attain  a  basis  for  this  discussion,  it  is  necessary 
to  allude  to  the  two  fundamental  doctrines  on  which  the  plan  is 
founded.  The  first  is  the  underlying  theory  of  private  property; 
the  second  is  the  theory  of  the  relation  of  the  individual  to  the 
public  purse. 

In  the  first  place,  the  Single  Tax  theory  of  property  is  the 
lal)or  theory — the  theory  that  individual  human  labor  constitutes 
the  only  clear  title  to  property.  It  would  be  interesting,  were 
there  space,  to  trace  the  genesis  of  this  doctrine.  The  Romans, 
as  is  well  known,  had  an  entirely  different  theory — the  occupa- 
tion theory,  based  on  the  right  of  the  first  occupant.  Against 
this  rather  brutal  doctrine,  which  in  the  early  middle  ages 
paved  a  way  for  intolerable  abuses,  the  philosophers  advanced 
the  labor  theory,  hoping  thereby  to  bring  about  a  reform  in 
actual  institutions.  The  labor  theory  went  hand  in  hand  with 
the  doctrine  of  natural  rights,  which  was  the  result  of  an 
earnest  attempt  to  abolish  the  abuses  of  the  ancieii  regime,  and 
which  came  to  a  climax  in  the  eighteenth  century.  Modern 
jurisprudence  and  modern  political  philosophy,  however,  have 
incontestaljly    pro\ed    the    mistake    underlying    this    assumption 

*  Reprinted  by  permission  of  the  author. 


SINGLE   TAX  141 

of  natural  law  or  natural  rights.  They  have  shown  that  na- 
tural law  is  simply  the  idea  of  particular  thinkers  of  a  particu- 
lar age  of  what  ought  to  be  law.  These  particular  thinkers, 
indeed,  often  influence  the  social  consciousness,  as  they  in  turn 
are  influenced  by  it,  so  that  natural  law  may  be  called  law  in 
the  making.  But  at  any  given  time  it  represents  simply  an 
ideal.  Whether  that  ideal  will  approve  itself  to  society  depends 
on  a  variety  of  circumstances,  but  chiefly  on  the  question  whether 
society  is  prepared  for  the  change.  Just  as  the  modern  method 
of  jurisprudence  is  the  historical  method,  so  also  the  modern 
theory  of-  property  may  be  called  the  social  utility  theory. 

The  social  utility  theory  says  that  just  as  all  law,  all  order 
and  all  justice  are  the  direct  outgrowths  of  social  causes,  and 
just  as  private  ethics  is  nothing  but  the  consequence  of  social 
ethics,  so  private  property  is  to  be  justified  simply  by  the  fact 
that  it  is  the  last  stage  of  a  slo\v  and  painful  social  evolution. 
At  the  outset,  property,  and  especially  property  in  land,  was 
largely  owned  in  common.  It  was  only  through  the  gradual 
progress  of  economic  and  social  forces  that  private  property 
came  to  be  recognized  as  tending  on  the  whole  to  further  the 
welfare  of  the  entire  community.  The  social  utility  iheory  does 
not,  of  course,  mean  that  what  has  once  been  must  always  be. 
It  is  not  a  reactionary  doctrine  which  looks  upon  all  that  is  as 
good.  It  simply  maintains  that  the  burden  of  proof  is  always 
upon  the  party  urging  the  change;  and  that  when  the  change 
advocated  is  a  direct  reversal  of  the  progress  of  centuries,  and 
a  reversion  to  primitive  conditions  away  from  which  all  history 
has  travelled,  the  necessity  for  its  absolute  proof  becomes  far 
stronger.  The  nationalization  of  land  is  a  demand  which,  in 
order  to  win  general  acceptance,  must  be  based  on  theories  in- 
dependent of  the  doctrine  of  natural  rights. 

Even  though  we  accept  the  theory  of  natural  rights,  we  need 
not  therefore  accept  the  Single  Tax.  If  it  be  said  that  the  value 
of  land  is  wholly  the  work  of  the  community,  and  that  therefore 
every  one  has  a  natural  right  to  it,  how^  can  we  logically  deny 
that  the  value  of  any  so-called  product  is,  at  least  partly,  the  work 
of  the  community?  Mr.  George  bases  his  defence  of  private 
property  in  commodities  other  than  land  on  the  labor  theory. 
Yet  individual  labor,  it  may  be  said,  has  never  by  itself  produced 
anything  in  civilized  society.     Take,  for  example,  the  workman 


142  SELECTED   ARTICLES 

fashioning  a  chair.  The  wood  has  not  been  produced  by  him ; 
it  is  the  gift  of  nature.  The  tools  that  he  uses  are  the  result 
of  the  contributions  of  others ;  the  house  in  which  he  works,  the 
clothes  he  wears,  the  food  he  eats  (all  of  which  are  necessary  in 
civilized  society  to  the  making  of  a  chair),  are  the  result  of  the 
contributions  of  the  community.  His  safety  from  robbery  and 
pillage — nay,  his  very  existence — is  dependent  on  the  ceaseless 
co-operation  of  the  society  about  him.  How  can  it  be  said,  in  the 
face  of  all  this,  that  his  own  individual  labor  wholly  creates  any- 
thing? H  it  be  maintained  that  he  pays  for  his  tools,  his  clothing 
and  his  protection,  it  may  be  answered  that  the  landowner  also 
pays  for  the  land.  Nothing  is  wholly  the  result  of  unaided  in- 
dividual labor.  No  one  has  a  right  to  say :  This  belongs  abso- 
lutely and  completely  to  me,  because  I  alone  have  produced  it. 
Society,  from  this  point  of  view,  holds  a  mortgage  on  everything 
that  is  produced.  The  socialists  have  been  in  this  respect  more 
logical ;  and  that  perhaps  explains  why  the  movement  to  which 
Mr.  George  gave  such  an  impetus  in  England  and  elsewhere  is 
fast  changing  from  one  in  favor  of  land  nationalization  into  one 
for  the  nationalization  of  all  means  of  production.  The  socialists, 
indeed,  as  well  as  Mr.  George,  are  in  error,  because  the  premises 
of  each  are  wrong.  It  is  not  the  labor  theory,  but  the  social 
utility  theory,  which  is  the  real  defence  of  private  property.  But 
if  we  accept  the  premises  of  the  Single-Taxers,  we  are  inevitably 
impelled  to  go  further  than  they  do.  The  difference  between 
property  in  land  and  property  in  other  things  is  from  the  stand- 
point of  individual  versus  social  effort  simply  one  of  degree,  not 
of  kind. 

The  other  fundamental  doctrine  of  the  advocates  of  the  Single 
Tax  is  the  theory  of  benefit, — the  doctrine  that  a  man  ought  to 
contribute  to  public  burdens  in  proportion  to  the  benefits  that  he 
receives.  The  theory  is  that,  since  the  individual  gets  a  special 
advantage  from  the  community  in  the  shape  of  unearned  incre- 
ment he  ought  to  make  some  recompense.  To  this  contention, 
two  answers  may  be  had  :  first,  that  the  benefit  theory  of  taxa- 
tion is  inadequate;  and  second,  that,  even  if  it  were  true,  it 
would  not  support  the  Single  Tax.    Let  us  take  up  these  in  turn. 

The  payments  made  by  the  individual  to  the  government  are 
exceedingly  diverse  in  character.  Where  the  government  acts 
simply  as  a  private  individual,  in  performing  certain  services  for 


SINGLE   TAX  143 

the  citizen,  the  payment  is  a  price.  The  government  does  some- 
thing; the  individual  gives  something.  Again,  even  after  com- 
mon interests  have  developed,  the  individual  may  ask  the  gov- 
ernment to  do  some  particular  thing  for  him,  to  confer  some 
privilege  upon  him.  He  may  wish  to  get  married  or  to  run  a 
cab.  For  this  particular  privilege  it  is  perfectly  proper  that  the 
government  should  make  a  charge  —  known  in  modern  times  as 
a  fee  or  toll.  Again,  the  government  may  be  at  considerable  ex- 
pense in  laying  out  a  new  street,  the  result  of  which  will  be  to 
enhance  the  value  of  a  particular  plot  of  ground.  There  is  then 
no  reason  why  the  government  should  not  demand  that  the 
owner  of  this  plot  should  defray,  at  all  events  in  part,  the  cost 
of  this  improvement.  This  is  called  special  assessment.  In  all 
these  cases  the  individual  receives  an  undeniable,  special  benefit 
as  the  result  of  a  special  expenditure  made  by  the  government. 
The  principle  of  give   and  take,   therefore,   is  applicable. 

On  the  other  hand,  there  are  certain  actions  of  the  govern- 
ment which  interest  the  whole  community,  and  from  which  the 
individual  receives  no  benefit,  except  what  accrues  to  him  inciden- 
tally as  a  member  of  the  community.  If  the  government  under- 
takes a  war.  no  one  citizen  is  benefitted  more  than  another.  If 
the  government  spends  money  for  cleaning  the  main  thorough- 
fares, for  erecting  tribunals,  or  for  patrolling  the  city  by  police, 
it  cannot  be  claimed  that  any  one  individual  receives  a  measur- 
able, special  benefit ;  all  are  equally  interested  in  good  govern- 
ment. When  payment  Is  made  for  these  general  expenditures — 
and  such  a  payment  Is  called  a  tax  —  the  principle  of  contribu- 
tion Is  no  longer  that  of  benefits  or  of  give  and  take,  but  of 
ability,  faculty,  capacity.  Every  man  must  support  the  govern- 
ment to  the  full  extent.  If  need  be,  of  his  ability  to  pay.  He  does 
not  measure  the  benefits  of  state  action  to  himself  first,  because 
these  benefits  are  quantitatively  unmeasurable :  and  secondly,  be- 
cause such  measurement  implies  a  decidedly  erroneous  concep- 
tion of  the  relation  of  the  Individual  to  the  modern  state. 

The  principle  of  benefit,  moreover,  would  lead  us  into  the 
greatest  absurdities.  If  we  accept  It.  we  must  apply  it  logically; 
we  must  not  restrict  its  beneficent  workings  to  the  landowner. 
The  poor  man,  according  to  the  theory  of  benefit,  ought  to  be 
taxed  more  than  the  rich,  because  he  is  less  able  than  the  rich 
man  to  protect  himself.     Ability  to  pay  Is  not  only  the  Ideal  basis 


144  SELECTED   ARTICLES 

of  taxation,  but  the  goal  toward  which  society  is  steadily  work- 
ing. It  lies  instinctively  and  unconsciously  at  the  bottom  of  all 
our  endeavors  at  reform.  When  we  say  that  indirect  taxes  are 
on  the  whole  unfair  to  laborers,  we  mean  that  they  are  less  able 
than  the  wealthier  portion  of  the  community  to  pay  the  tax. 
When  we  say  that  a  corporation  with  large  receipts  should  pay 
more  than  one.  with  small  receipts,  we  do  so  because  we  know 
that  its  ability  to  pay  is  greater.  The  principle  of  privilege  or 
benefit  is,  therefore,  not  the  basis  of  taxation.  It  is  the  principle 
away  from  which  all  modern  science  and  progress  have  been 
working.  It  is  founded  on  a  false  political  philosophy,  and  it  can 
result  only  in  a  false  political  economy. 

But  even  if  we  accept  the  principle  of  benefit  or  opportunity, 
it  will  not  justify  the  demand  for  the  Single  Tax.  This  question 
however,  is  so  intimately  interwoven  with  the  problem  of  the  jus- 
tice of  the  Single  Tax  that  we  shall  discuss  it  a  little  further  on 
under  that  head. 

Fiscal  Defects 

One  of  the  great  aims  of  every  sound  financial  system  is  to 
bring  about  an  equilibrium  of  the  budget  —  that  is,  to  avoid  a 
surplus  as  well  as  a  deficit.  Now,  while  many  taxes  may  be  sud- 
denly lowered,  not  many  of  them  can  be  made  to  give  a  sud- 
denly increased  yield.  One  of  the  cardinal  principles  of  taxa- 
tion, therefore,  is  elasticity,  in  order  to  secure  which  requires  two 
conditions.  In  the  first  place,  the  source  from  which  the  tax  is 
derived  must  be  of  such  a  nature  that  an  increase  of  the  rate 
will  always  mean  an  increase  of  the  yield.  There  should  be  in 
the  source  of  taxation  a  reserve  power  which  can  be  draw-n  upon 
in  case  of  need.  Secondly,  the  revenue  should  be  secured  from  a 
number  of  objects,  so  that  the  shrinkages  or  deficits  temporarily 
due  to  the  one  class  may  be  made  good  by  the  increase  or  sur- 
plus revenues  of  the  other  class.  Among  the  elastic  taxes  is  the 
income  tax,  and  it  is  well  known  that  in  English  finance  one  of 
the  chief  functions  of  this  income  tax  is  to  preserve  the  equilib- 
rium of  the  budget.  So  again,  certain  taxes  on  commodities  are 
often  utilized  for  this  purpose.  The  Single  Tax  on  land  values, 
however,  is  bitterly  inelastic:  for  since,  according  to  the  theory 
of  its  advocates,  the  total  rental  value  is  to  be  taken  from  the 


SINGLE   TAX  145 

landowners,  the  Single  Tax  cannot  be  increased.  Where  nothing 
has  been  left,  nothing  more  can  be  taken.  In  the  case  of  an 
emergency  there  would,  therefore,  be  no  possibility  of  increasing 
the  revenues.  Even  if  the  total  land  value  were  not  taken,  it 
would  still  remain  true  that  a  direct  tax  on  the  unimproved  value 
of  land  is  far  more  inelastic  than  other  taxes ;  for  when  the 
supply  is  constant  and  the  price  is  fixed  only  by  conditions  of  de- 
mand, the  selling  value  as  well  as  the  rental  value  is  subject  to 
far  more  fluctuations  than  in  commodities  where  the  supply  may 
be  diminished  at  pleasure.  Futhermore,  as  we  have  seen,  a  Sin- 
gle Tax  of  any  kind,  whether  on  lands  or  on  anything  else,  w^ould 
be  less  elastic  than  a  system  of  taxes  where  one  may  be  played 
off  against  the  other.  Lack  of  elasticity  is  a  serious  defect  in  the 
Single  Tax. 

Another  fiscal  weakness  of  the  Single  Tax  is  that  it  inevitably 
intensifies  the  inequalities  resulting  from  unjust  assessments. 
We  all  know  how  difficult  it  is  to  carry  out  laws  which  provide 
for  equal  assessments.  Under  the  real  estate  tax  in  the  United 
States,  for  example,  the  assessors  are  usually  sworn  to  rate  the 
property  at  its  actual  or  selling  value,  and  the  selling  value  of  a 
piece  of  land  or  of  a  house  is  comparatively  easy  to  ascertain; 
yet  it  is  notorious  that  in  no  two  counties,  nay  even  in  no  two  ad- 
joining pieces  of  property,  is  the  standard  of  assessment  the 
same.  Thus  the  report  of  the  Iowa  Revenue  Commission  of 
1893,  states  that  realty  in  Iowa  was  assessed  at  from  seventeen 
to  sixty  per  cent  of  the  true  value.  It  is  well  known,  too,  that 
in  the  city  of  Chicago  adjacent  plots  of  real  estate  are  assessed 
at  percentages  of  ridiculously  varying  degree.  Now,  it  is  mani- 
festly not  so  easy  to  assess  the  land  values,  —  that  is,  the  bare 
value  of  the  land  irrespective  of  all  improvement, — as  it  is  to 
assess  the  selling  value  of  a  piece  of  real  estate.  For  instance, 
an  acre  of  agricultural  land  near  a  large  town  may  be  worth 
$200;  but  if  used  for  truck-farming,  considerably  more  than  $200 
may  have  been  expended  on  it  during  the  last  century  or  two. 
Who  can  tell  how  much  of  the  $200  present  value  is  the  value  of 
the  bare  land  and  how  much  is  to  be  assigned  to  the  labor  ex- 
pended? Under  the  present  method  we  have  at  least  a  definite 
test — the  selling  value :  under  the  new  method  we  should  have 
no  test  at  all.     There  is  every  likelihood,  therefore,  that  the  dififi- 


12 


146  SELECTED   ARTICLES 

culties  of  the  present  situation  would  be  intensified.  Moreover, 
under  the  present  system,  inadequate  as  it  is,  there  is  always 
a  chance  that  the  imperfect  enforcement  of  a  particular  tax  law 
will  be  offset  by  the  assessment  of  other  taxes,  direct  or  indirect. 
Under  the  Single  Tax  not  only  would  there  be  more  difficulty  than 
at  present  in  making  the  original  assessment,  but  the  inequality 
of  the  assessment,  which  is  inseparable  from  all  democratic 
methods,  would  be  seriously  intensified  by  the  very  fact  that  it  is 
a  Single  Tax. 

Political  Defects 

The  adoption  of  the  Single  Tax  means  the  total  abolition  of  all 
custom  houses  and  import  duties ;  it  means  that  there  can  be  no 
such  thing  as  a  system  of  protection  to  home  industry.  Many 
would,  it  is  true,  favor  the  Single  Tax  precisely  on  this  account ; 
but  there  are  some  self-styled  "Single-Taxers"  who  believe  that 
as  a  matter  of  national  policy  there  is  a  justification  for  import 
duties.  Whatever  we  may  think  of  the  economic  justification  of 
import  duties,  it  must  be  recognized  that  they  may  sometimes 
form  an  important  political  weapon.  It  is  clear,  however,  that 
leaving  the  question  of  protection  entirely  aside,  the  adoption  of 
the  Single  Tax  will  make  it  impossible  to  utilize  import  duties 
for  political,  fiscal  or  other  purposes. 

In  the  second  place,  the  adoption  of  the  Single  Tax  would 
render  it  impossible  for  governments  to  utilize  the  taxing  power 
as  a  political  or  social  engine  in  any  other  way.  For  instance, 
the  United  States  government  now  imposes  a  tax  on  the  circu- 
lation of  state  bank-notes  in  order  to  bring  about  certain  de- 
sirable results  in  the  currency  situation.  Under  the  Single  Tax 
this  would  be  impossible.  Again,  the  United  States  government 
levies  a  high  tax  on  opium,  not  for  the  purpose  of  revenue, 
but  in  order  to  discourage  the  consumption  of  opium ;  and  it 
also  assesses  a  tax  on  oleomargarine,  primarily  in  order  to  en- 
sure the  purity  of  butter.  Under  the  Single  Tax,  all  such  efforts 
would  be  impossible.  Finally,  to  mention  only  one  other  ex- 
ample, one  of  the  chief  methods  of  dealing  with  the  drink  ques- 
tion is  through  the  imposition  of  high  liquor  licenses,  the  fiscal 
importance  of  which  is  only  secondary.  Under  the  Single  Tax 
we  should  be  prevented  from  attacking  the  problem  in  that  way. 
Governments  have  always  made  use  of  the  taxing  power  to  regu- 
late and  to  destroy,  as  well   as  to  yield  a  revenue.     Were  the 


SINGLE   TAX  147 

Single  Tax  to  be  adopted,  this  salutary  power  would  be  entirely 
taken  away. 

Thirdly,  the  political  results  of  the  Single  Tax  would  be  dan- 
gerous in  another  way.  So  far  as  there  is  any  truth  in  the  asser- 
tion that  in  democracy  it  involves  some  risk  for  a  small  class 
to  pay  the  taxes  and  for  a  large  class  to  vote  them,  it  is  es- 
pecially applicable  to  the  Single  Tax.  Since  the  "unearned  in- 
crement "  would  flow  of  itself,  silently  and  noiselessly  into  the 
treasury,  there  would  be  no  need  of  a  budget;  and  the  sense  of 
responsibility  in  the  citizens  would  be  perceptibly  diminished.  It 
is  well  known  that  liberty  has  been  intimately  bound  up  with  the 
contest  against  unjust  taxation;  the  constitutional  history  of 
England  is  to  a  large  extent  a  history  of  the  struggle  of  the 
people  to  gain  control  of  the  treasury;  the  American  Revolution 
was  precipitated  by  a  question  of  taxation;  the  French  Revolu- 
tion was  brought  about  primarily  by  the  fiscal  abuses  of  the 
ancien  regime.  To  take  away,  then,  from  the  vast  majority  of 
citizens  the  sense  of  their  obligation  to  the  government,  and  to 
divorce  their  economic  interests  from  those  of  the  state,  would, 
especially  in  a  democracy  like  that  of  America,  be  fraught  with 
serious  danger. 

Ethical  Defects 

The  advocates  of  the  Single  Tax  love  to  base  their  arguments 
on  the  ground  of  justice.  In  this  they  are  certainly  wise;  for 
even  though  all  other  arguments  were  in  its  favor,  if  the  justice 
of  the  Single  Tax  could  be  successfully  impugned  it  would  be 
foredoomed  to  failure.  Let  us  then  ascertain  whether  it  is 
indeed  true  that  the  Single  Tax  is  an  equitable  method  of 
taxation. 

The  two  great  canons  of  justice  in  taxation  are  universality 
and  uniformity  or  equality.  If  anything  has  been  gained  by  the 
revolutions  of  the  eighteenth  century  and  by  the  growing  public 
conscience  of  the  nineteenth,  it  is  a  recognition  of  the  fact  that 
all  owe  a  duty  to  support  the  state,  that  a  system  of  wholesale 
exemptions  is  iniquitous,  and  that  all  taxpayers  should  be  treated 
according  to  the  same  standard.  Judged  by  any  or  all  of  these 
tests,  can  it  be  seriously  maintained  that  the  Single  Tax  is  an 
equitable  form  of  taxation? 

We  have  seen  that  the  theory  of  natural  rights  is  not  ade- 


148  SELECTED   ARTICLES 

quatc ;  we  have  learned  that  the  principle  of  opportunity  does  not 
correctly  portray  the  relations  of  the  individual  to  the  state. 
Even  if  the  theory  of  unearned  increment  were  true  it  would 
not  by  any  means  justify  the  Single  Tax  on  land  values.  In  the 
first  place,  land  values  do  not  always  or  necessarily  increase; 
and,  secondly,  there  are  a  great  many  other  values  which  do  in- 
crease, and  which  increase  mainly  by  the  operation  of  forces 
which  the  owner  of  the  property  neither  creates  nor  controls. 

Land  values  do  not  always  or  necessarily  increase.  Thus, 
in  the  testimony  given  before  the  Rapid  Transit  Commission  in 
the  city  of  New  York  in  March,  1895,  one  of  the  witnesses 
spoke  of  several  long  avenues  being  lined  with  the  graves  of 
property-owners.  What  did  he  mean  ?  Simply  that  ten,  or 
twenty,  or  thirty  years  ago,  certain  individuals  had  invested 
in  the  land,  in  hopes  of  a  rise  in  value,  just  as  people  invest  in 
bonds  or  stocks  or  other  securities.  Instead  of  values  rising, 
however,  they  remained  stationary  or  even  decreased;  while,  in 
the  meantime,  the  accumulated  taxes  and  assessments  upon  this 
non-productive  property  completely  ruined  many  of  the  inves- 
tors. It  is  indeed  true  that  in  most  growing  cities  land  values  in 
certain  localities  w^ill  increase;  but  it  is  equally  true  that  there 
are  always  sections  in  such  cities  where,  for  obvious  reasons, 
land  values  decrease.  These  facts  are  familiar  to  all  observers 
in  large  cties.  Moreover,  in  some  European  countries  the  rental 
value  of  the  land,  as  a  whole,  is  less  to-day  than  it  was  a  few 
decades  ago.  The  tax  on  land  value  would  there  yield  only  a 
precarious  revenue,  since  there  has  been  no  unearned  increment, 
but  a  decrement. 

More  important  still  is  the  fact  that  even  though  land  values 
often  increase,  similar  increase  in  value  is  not  by  any  means 
confined  to  land.  Let  us  ask  any  one  whose  mind  is  not  be- 
fogged by  the  mist  of  erroneous  enthusiasm:  Who  are  the 
rich  men  of  the  world  to-day  ?  How  has  by  far  the  greater 
part  of  our  huge  individual  fortunes  been  acquired?  Let  us 
study  the  way  in  which  men  have  become  millionaires,  especially 
in  the  United  States.  The  usual  cause  is  some  fortuitous  con- 
juncture of  events,  some  chance  happening  due  to  no  one's  labor, 
but  to  a  tiu-n  in  the  wheel  of  fortune— call  it  speculation,  call  it 
luck,  call  it  by  any  name  we  will.  How  have  most  of  the  fortunes 
in  Wall   Street  been  made?    Who  is  responsible  for  the  increased 


SINGLE   TAX  149 

value  of  investments  ?  Who  can  say  that  the  successful  manager 
of  the  ring,  the  corner,  the  pool  and  the  trust  has  worked  out  his 
salvation  through  his  own  industry?  Land  speculation  is  only  a 
part,  and  a  very  small  part,  of  the  sum  total.  If  it  be  claimed 
that  the  fortunate  speculator  deserves  his  fortune  because  of  his 
sagacity  and  foresight,  why  deny  these  attributes  to  the  land- 
owner? It  can,  of  course,  not  be  denied  that  wealth  has  been 
acquired  by  thrift  and  industry;  but  it  remains  true  that  most 
of  the  very  large  fortunes  that  strike  the  common  observer  are 
due  to  these  incalculable  turns  in  the  wheel  of  fortune,  and  that 
the  so-called  unearned  increment  of  land  values  forms  only  a 
small  share  of  these  total  gains. 

It  must  not  be  forgotten  that  the  modern  age  is  the  age  of 
speculation,  differing  from  former  periods  in  that  "  time  specu- 
lation "  has  supplanted  ''  place  speculation."  No  economist 
would  to-day  venture  to  deny  that  speculation  has  its  legitimate 
uses,  and  that  the  stock  and  produce  exchanges  of  the  present 
day  play  an  indispensable  part  in  the  economy  of  our  complex 
industrial  society.  But  speculation  is  largely  responsible  for 
modern  fortunes ;  and  land  speculation  is  simply  a  species  in  the 
larger  genus.  Value  is  a  social  phenomenon,  not  an  individual 
phenomenon.  A  house  in  a  desert  is  worth  nothing ;  a  house  in 
a  small  town  is  worth  more;  a  house  in  a  large  city  is  worth 
still  more.  The  house  is  in  part  the  product  of  labor,  but  the 
greater  demand  increases  the  value.  A  newspaper  also  is  more 
profitable  in  a  city  than  in  a  village.  Thus,  if  social  environment 
gives  a  value  to  bare  land,  the  same  social  environment  in- 
creases the  demand  for  other  commodities.  If  it  be  said  that 
land  differs  from  other  things  in  that  it  is  a  monopoly,  the  an- 
swer is  irresistible  that  if  there  is  any  one  thing  which  distin- 
guishes the  modern  age,  it  is  the  development  of  industrial  mon- 
opoly; we  live  in  a  period  of  pools  and  trusts  and  economic 
monopolies  of  all  kinds.  So  important,  indeed,  have  these  be- 
come that  modern  economic  theory  has  been  compelled  to  sup- 
plement the  old  doctrine  of  value  which  was  based  on  the  as- 
sumption of  free  competition  by  a  newer  and  more  comprehen- 
sive theory,  especially  applicable  to  all  these  modern  forms  of 
monopoly  price.  These  monopoly  profits  cannot  be  reached  by 
a  tax  on  land  values. 

On  what  possible  theory  of  justice,  then,  shall  we  tax  the  man 


ISO  SELECTED   ARTICLES 

who  has  invested  $100,000  in  land  which  the  next  year  appre- 
ciates fifty  per  cent ;  and,  on  the  other  hand,  exempt  the  man 
who  has  invested  $100,000  in  the  stock  of  the  Sugar  Trust, 
which  the  next  year  may  also  enhance  fifty  per  cent?  Why 
should  the  earnings  invested  in  land  be  taxed  and  the  earnings 
invested  in  the  Sugar  Trust  be  wholly  untaxed?  Why  should 
the  earnings  invested  in  land  be  taxed  and  the  earnings  invested 
in  any  railway  bond  be  wholly  untaxed  ? 

It  might,  indeed,  be  claimed  that  the  railway  stockholder  will 
be  affected  by  a  tax  on  the  land  owned  by  the  corporation :  but  it 
is  difficult  to  see  how  the  railway  bondholder  can  be  reached  by 
any  tax  on  land  values  except  in  so  far  as  the  ultimate  security 
for  his  debt  may  be  affected.  As  the  bonded  indebtedness  of  the 
railways  to-day  far  exceeds  their  capital  stock  it  appears  that, 
even  in  the  case  of  these  industries  whose  increasing  values  are 
largely  due  to  the  influence  of  the  communit}',  the  majority  of 
investors  would  scarcely  be  touched.  In  the  great  mass  of  in- 
dustries, of  which  the  Sugar  Trust  is  an  example,  where  the  land 
owned  by  the  corporation  is  of  exceedingly  small  consequence  as 
compared  with  its  other  assets,  it  is  plain  that  a  tax  on  land 
values  would  not  reach  even  the  stockholders  or  the  owners 
proper.  Almost  every  industry,  moreover,  is  dependent  for  its 
increasing  profits  upon  the  development  of  the  community,  that 
is,  upon  the  increasing  demand  for  the  product.  Land  rises  in 
value  because  there  are  more  people  who  want  to  occupy  that 
land;  the  earnings  of  the  Sugar  Trust  have  increased  chiefly  be- 
cause there  are  more  people  who  want  sugar.  In  each  case  the 
increased  returns  are  due  primarily  to  social  causes ;  in  each  case 
we  have  a  monopoly.  One  is  a  natural  monopoly  and  the  other 
is  an  economic  or  artificial  monopoly;  but,  for  all  practical  pur- 
poses, there  is  no  distinction  between  them.  To  confiscate  the 
capital  invested  in  land  with  the  chance  of  the  land  either  falling 
or  rising  in  value,  while  exempting  absolutely  the  capital  in- 
vested in  corporate  or  industrial  securities,  is  but  a  travesty  of 
justice.  It  will  be  impossible  to  convince  the  common  people 
that  so-called  unearned  increments  are  confined  to  land.  As  a 
matter  of  fact  the  "  unearned  increment  "  of  land  is  only  one  in- 
stance of  a  far  larger  class. 

We  must,  on  the  contrary,  plant  ourselves  firmly  on  the  basis 
of  faculty  or  ability  to  pay.     So  far  as  a  man  receives  special  op- 


SINGLE   TAX  151 

portunities  from  the  community,  which  undoubtedly  increase  his 
abihty  to  pay,  they  should  be  taken  into  account  in  framing  any 
scheme  of  taxation.  But  let  us  not  single  out  one  special  oppor- 
tunity, because  it  strikes  the  eyes  of  urban  observers,  while  we 
neglect  all  the  other  opportunities  which  are  equally,  or  almost 
equally,  the  result  of  social  forces.  The  Single  Tax  on  land 
values  is  unjust;  first,  because  opportunity  is  not  the  only  ele- 
ment that  must  be  taken  into  account;  and,  secondly,  because, 
even  though  it  were,  revenues  from  land  are  by  no  means  the 
only  form  — nay,  not  even  the  most  important  form  — of  the  re- 
sults of  special  opportunity.  The  Single  Tax  is  unjust  because  it 
is  exclusive  and  unequal. 

But,  even  though  the  Single  Tax  were  absolutely  just  in  theory, 
it  would  not  yet  follow  that  it  would  be  practicable.  Let  us,' 
therefore,  come  to  the  final  part  of  our  inquiry. 

Economic  Defects 

These  considerations  which  have  often  been  overlooked,  may  be 
discussed  from  three  points  of  view :  first,  the  economic  effect 
of  the  Single  Tax  on  poor^and  new  communities;  second,  the 
economic  effect  on  farmers  and  the  agricultural  interests  in  gen- 
eral; third,  the  economic  effect  on  rich  communities. 

In  the  first  place,  what  would  be  the  effect  on  poor  and  new 
communities  ? 

When  an  American  farmer  goes  to  the  virgin  soil  of  the 
Northwest  and  stakes  out  his  farm,  he  finds  virtually  no  land 
value  at  all;  land  can  be  secured  by  any  one  on  the  payment 
of  a  merely  nominal  sum.  The  only  property  of  these  new 
farmmg  communities  consists  of  the  log  cabins  erected  on  the 
land;  of  the  tools,  implements  and  beasts  of  burden  used  for 
tilling  the  land ;  and  of  the  personal  effects  and  money  that  are 
in  many  cases  brought  along  by  the  farmers.  The  great  mass 
of  their  possessions,  therefore,  consists  of  personalty.  In  so  far 
as  there  is  any  real  property  at  all,  it  is  only  to  an  exceedingly 
slight  extent  composed  of  land  values.  Tliere  is  practically  ""no 
land  value.  How  then,  it  may  be  asked,  can  taxes  be  raised  in 
this  new  community  ?  How  can  the  roads  be  laid  out,  the  school- 
houses  be  erected,  and  the  other  improvements  be  effected? 
Since  land  values  are  non-existent,  a  tax  on  zero  must  be  zero. 
Even  if   any   land   values   exist,   the   total   confiscation   of  them 


152  SELECTED   ARTICLES 

would  not  suliice  to  defray  any  considerable  part  of  the  neces- 
sary expenditures.  For  proof,  take  any  of  the  assessors'  reports 
in  the  new  American  states,  and  it  will  be  found  that,  contrary 
to  the  conditions  of  the  rest  of  the  country,  the  assessed  personal 
property  far  exceeds  in  value  the  total  assessed  real  estate.  For 
instance,  in  1890  personalty  was  to  total  realty  in  Montana  as 
58  to  55  millions  of  dollars,  in  Wyoming  as  20  to  13  millions,  in 
New  Mexico  as  28  to  15  millions,  in  Arizona  as  18  to  10  mil- 
lions. Compare  these  figures  with  the  older  sections,  as  New 
York  or  Pennsylvania,  where  the  proportion  was  as  382  to  34^4 
millions  and  618  to  2042  millions  respectively.  If  we  are  to 
abolish  not  only  the  tax  on  personalty,  but  all  that  part  of  the  tax 
on  realty  which  is  not  drawn  from  land  values,  it  can  easily  be 
seen  how  impossible  it  would  be  to  carry  on  government  in 
these  sections.  A  tax  on  the  land  values  would  be  lamentably 
inadequate. 

What  has  been  said  of  new  communities  applies  almost 
equally  well  to  poor  communities,  that  is,  to  communities  made 
up  largely  or  almost  entirely  of  farm  lands  and  of  an  agricul- 
tural population.  The  "Single-Taxers"  themselves  claim  that 
land  values  amount  to  practically  nothing  in  the  farming  dis- 
tricts. We  shall  see  below  the  fallacy  in  this  general  contention; 
but  so  far  as  the  community  is  a  poor  one  there  is  undoubted 
truth  in  the  statement  that  land  values  are  trivial.  If  this  is  true, 
how  can  the  expense  be  defrayed  by  a  Single  Tax  on  land  values? 
In  the  testimony  recently  taken  before  the  tax  commission  of 
Massachusetts,  one  of  the  Single-Taxers  who  was  testifying  as  to 
the  situation  in  certain  rural  townships  was  asked  the  question  : 
How  will  it  be  possible  for  this  poor  town,  in  which  there  is 
very  little  land  value,  to  raise  its  taxes?  The  witness  was  com- 
pelled to  reply  that  it  would  be  impossible  for  the  community  to 
do  so,  and  he  suggested  that  the  expenses  of  the  poor  communi- 
ties should  be  defrayed  in  large  part  from  the  revenues  of  the 
rich  communities. 

This  remedy  is  somewhat  visionary ;  for  with  the  American 
theories  of  local  government,  it  would  be  almost  impossible  to 
induce  certain  sections  in  the  community  to  assume  the  burdens 
of  other  sections.  We  are  all  acquainted  with  the  continual 
bickerings  in  our  state  taxation,  due  to  the  efforts  of  the  richer 
counties    to    escape    paying    more    than    their    proportion    of   the 


SINGLE   TAX  153 

general  state  taxes ;  and  we  have  recently  seen  the  discontent 
aroused  by  an  attempt  in  the  shape  of  the  federal  income  tax 
to  make  certain  wealthy  sections  of  the  country  pay  the  larger 
part  of  the  revenue  of  the  national  government.  Where  these  ef- 
forts have  given  rise  to  so  much  dissatisfaction,  it  is  obviously 
out  of  the  question  to  suppose  that  the  purely  local  expenses  of 
any  community  will  ever  be  defrayed  by  the  efforts  of  other  com- 
munities. In  local  matters,  at  least,  every  county  and  town  must 
stand  on  its  own  feet ;  and  if  the  Single  Tax  is  unable  to  de- 
fray even  the  local  expenses  of  a  poor  community,  not  to  speak 
of  its  share  of  general  state  or  federal  expenses,  it  is  clearly 
beyond  the  realm  of  practical  politics.  In  poor  communities,  as 
well  as  in  new  communities,  the  Single  Tax  would  be  an  impossi- 
bility. 

Let  us  consider,  next,  what  would  be  the  effects  of  the  Sin- 
gle Tax  on  farmers  in  general.  One  of  the  claims  of  the  advo- 
cates of  the  system  is  that  it  would  relieve  the  farming  popula- 
tion of  the  burden  of  taxes,  now  weighing  upon  them.  A  careful 
consideration  of  the  facts  shows,  however,  that  this  claim  is  un- 
founded, and  that,  on  the  contrary,  the  only  result  of  the  Single 
Tax  would  be  to  make  the  farmers  pay  more  than  they  are  pay- 
ing to-day.    This  can  be  proved  by  recent  statistics. 

In  only  a  few  states  is  a  distinction  made  in  the  assessments 
between  land  and  improvements  on  land.  Let  us  take,  as  a 
typical  instance,  Ohio  county,  in  West  Virginia,  in  which  the 
city  of  Wheeling  is  situated.  In  the  auditor's  report  for  1892, 
we  find  the  following  figures  : — 

Proportion 
of  Ohio 
County. 
Ohio  Entire      Per 

County.  State,      cent. 

Value  of  buildings  on  lots $8,544,010     $22,840,511 

A^alue  of  building  on  lands 671,795       14,371,855 

Total  value  of  buildings .$9.225.S0t     $37,212,366         25 

Value  of  town  lots  without  buildings         4,409,152       14,453,321 
Value  of  land  without  buildings 1,678,962       95,771,281 

Total  value    of   all    land    without 

buildings    $  6,0SS,11J  $110,224,502  51/2 

Total    value    of    lands,    lots    and 

buildings     15,313,919     147,685.972         lOVa 

Value  of  per.sonalty 6,187,710       51,707,093         12 

Present  total  assessment.s $21,501.62'^     $198  958,920         10l^ 

Population    41,000  763,000  S^A 


Ratio  of 

Value  of 

land  values 

improve- 

to total 

ments   un 

real  estate. 

real  estate. 

Per  cent. 

1.283,265 

89 

1,037,103 

92 

2,327,705 

88 

82,584,775 

70 

242,388,163 

76 

154  SELECTED   ARTICLES 

In  other  words,  whereas  Ohio  county  now  pays  ten  and  one- 
half  per  cent  of  all  taxes,  and  would  pay  about  the  same  if  real 
estate  alone  were  taxed,  if  the  Single  Tax  were  introduced  it 
w^ould  pay  only  five  and  one-half  per  cent  of  the  total  taxes,  or 
about  one-half  as  much  as  at  present.  If  the  large  towns  would 
have  to  pay  so  much  less,  of  course  the  farming  districts  would 
have  to  pay  so  much  more.  The  improvements  in  the  towns  are 
worth  more  than  the  value  of  the  bare  land  ;  while  in  the  coun- 
try districts  the  reverse  is  true. 

As  another  example  let  us  take  California.  In  the  comptrol- 
ler's report  for  1893,  we  find  the  following  figures  : — 


Value  of 
real  estate. 
County  (i.e.  bare  land) 

Colusa..." $  10,649,318 

Merced 11,222,179 

Tulare 17,258,512 

San  P'rancisco 193,872,645 

Total  State 757,980,207 

We  thus  see  that  while  in  the  city  of  San  Francisco  improve- 
ments equal  thirty  per  cent  of  the  total  real  estate  value,  in 
some  of  the  country  districts  improvements  are  only  ten  or  fif- 
teen per  cent  of  the  total.  Taking  the  state  as  a  whole,  land 
values  equal  seventy-six  per  cent  of  all  real  estate,  wdiile  in  San 
Francisco  land  values  arc  only  seventy  per  cent  of  all  real 
estate.  To  levy  the  Single  Tax  would,  therefore,  make  San  Fran- 
cisco pay  less,  and  some  of  the  country  counties  far  more,  than 
at  present. 

Again,  let  us  call  attention  to  the  report  of  the  Commission  on 
Valuation,  made  in  1892  to  the  Pennsylvania  Tax  Conference, 
which  is  probably  the  most  careful  attempt  yet  made  to  distin- 
guish land  values  from  improvements.  We  find  the  following 
figures : — 

Value  of 

Value  of  land.  improvements. 

Philadelphia  county   $    357,007,936  $    646,244,284 

Purely    agricultural    land   in    Phila- 
delphia  county 21,610,429  3.813,605 

Entire  state,  all  land 1,881,334,522  1.754,525,949 

Entire  state,  agricultural  land 725,485,439  245.494.072 

The  proportion  of  land  values  to  total  valuation  of  all  prop- 
erty is,  in  the  county  of  Philadelphia,  thirty-six  per  cent;  in  the 
agricultural    counties    of    Sullivan    and    Greene,    eighty-one    per 


SINGLE   TAX  155 

cent  and  seventy-five  per  cent,  respectively;  and  in  the  whole 
state,  fifty-two  per  cent.  The  Commission  concludes:  "As  a 
rule,  in  agricultural  counties  the  land  values  are  the  greatest,  as 
would  be  expected;  while  in  manufacturing  counties  and  those 
having  large  cities,  the  value  of  the  improvements  is  equal  to 
that  of  the  land,  or  greater." 

Let  us  now  choose  some  Western  states.  In  the  report  of  the 
auditor  of  Colorado  for  1894  we  find  the  followmg  figures  :— 

Value  of  agricultural  and  grazing-  land,   irrespective  of 

improvements    $36,907,810 

Value  of  improvements 7,492,022 

A'alue  of  town  and  city  land,  irrespective  of  improve- 
ments      63,080,205 

Value  of  improvements 34,788,941 

In  other  words,  in  the  towns  improvements  constitute  about 
one-third  of  the  total  values;  whereas  in  the  country,  improve- 
ments are  only  about  one-sixth  of  the  total. 

As  to  Montana  we  find,  in  the  report  of  the  Board  of  Equali- 
zation for   1894,   the   following  figures : — 

Value  of  city  and  town  lots $29,362,754 

Value  of  improvements  on  same 15,156,115 

Value  of  land 17,493,680 

Value  of  improvements  on  same 7,287,887 

In  Lewis  and  Clarke  county,  the  home  of  the  largest  city  in 
the  state,  the  total  value  of  all  land  was  $11,397,860;  that  of  im- 
provements, $5,269,300.  In  some  of  the  agricultural  or  grazing 
counties,  however,  the  value  of  the  land  was  far  higher  in  pro- 
portion to  the  improvements;  in  JMeagher  county,  for  example, 
land  was  $1,821,385,  while  improvements  were  only  $629,054. 
Most  striking  of  all,  in  this  very  same  county,  in  the  case  of  ag- 
ricultural property,  the  figures  were,  land  $1,218,474,  improve- 
ments $266,824;  while  in  the  town  lots  the  figures  were,  bare 
land  $602,911,  improvements  $362,375.  In  other  words,  not  only 
are  improvements  proportionately  less  in  the  rural  counties,  but 
even  in  these  rural  counties  by  far  the  larger  proportion  of  the 
improvements  are  found  in  the  little  towns,  as  compared  with  the 
farming  or  grazing  land  proper. 

In  the  state  of  Washington,  the  State  Board  of  Equalization 
agreed  on  the  following  figures  for  1893  '• — 

Value  of  land,  exclusive  of  improvements $  87.527.472 

Value  of  improvements 8,970,908 

Value  of  city  and  town  lots 101, 889)377 

Value  of  improvements 29,585,930 


156  SELECTED   ARTICLES 

In  Utah,  Salt  Lake  county,  the  seat  of  the  chief  city,  assessed 
in  1893,  real  estate,  exclusive  of  improvements,  at  $31,347,670;  im- 
provements, at  $9,483,141.  In  rural  counties  like  Rich  county  and 
Cache  county,  the  figures  were,  in  the  one  case,  realty  $527,666, 
improvements  $81,445;  in  the  other  case,  realty  $3,771,810, 
improvements  $915,614.  Here  again,  the  more  densely  settled  the 
township,  the  greater  in  proportion  is  the  value  of  the  improve- 
ments. 

Finally,  in  North  Dakota,  the  State  Board  of  Equalization  has 
fixed  the   valuation  for  1894  at  these   remarkable  figures:— 

Value  of  land,  exclusive  of  improvements $55,887,303 


Value  of  imi)rovements. 


2,608,01G 


Value  of  town  or  city  lots !'J-2'§J? 

Value  of  improvements  thereon 4.  iob,66i 

In  all  these  cases— and  they  might  be  multiplied  ad  infimtnm 
—  it  is  seen  that  the  value  of  the  improvements  is,  on  the  whole, 
greater  in  the  urban  than  in  the  rural  districts.  To  many  this 
will  be  a  surprise,  because  they  are  apt  to  be  blinded  by  the  im- 
mediate facts  about  them.  The  Single  Tax  advocate  generally 
lives  in  the  city,  and  sees  before  him  a  city  lot,  each  foot  of 
which  will  sell  for  hundreds  or  perhaps  thousands  of  dollars. 
The  town  lot,  he  is  apt  to  exclaim,  is  worth  hundreds  of  times 
as  much  as  a  piece  of  land  in  the  agricultural  districts.  This  is 
perfectly  true;  but  it  proves  nothing  as  to  the  comparative  ability 
of  their  owners  to  pay  taxes  because  it  overlooks  a  point  of  the 
greatest  importance.  When  we  compare  urban  with  agricultural 
land  values,  we  do  not  compare  foot  with  foot,  but  total  units 
with  total  units.  Thus,  an  acre  of  land  in  New  York  City  may 
be  worth  a  thousand  times  as  much  as  an  acre  of  land  in  the 
country;  but  it  must  be  remembered  that  there  are  many  thous- 
and times  as  many  acres  in  the  country  as  there  are  acres  in  New 
York  City. 

A  lot  in  New  York  may  be  w^orth  ten  thousand  dollars,  but 
a  farm  of  five  hundred  acres  in  the  country  may  also  be  worth 
ten  thousand  dollars,  exclusive  of  improvements.  We  must, 
therefore,  compare,  not  the  value  per  foot  in  the  New  York 
lot  with  the  value  per  foot  in  the  country  farm,  but  we  must 
compare  the  value  of  the  New  York  lot  with  the  value  of  the 
country  farm.  The  farmer  who  has  paid  ten  thousand  dollars 
for  his  farm,  and  has  then  proceeded  to  improve  and  cultivate  it, 


SINGLE   TAX  157 

will  not  be  satisfied,  when  the  assessor  taxes  him,  and  exempts 
all  the  business  men,  house-owners  and  security  holders  in  the 
adjoining  village;  he  will  not  be  satisfied  with  the  statement  that 
the  owner  of  a  ten-thousand-dollar  lot  in  New  York  City  pays 
a  hundred  times  as  much  per  front  foot.  He  will  be  apt  to  re- 
ply that  it  makes  no  difference  to  him  whether  the  New  Yorker's 
ten  thousand  dollars  is  taken  away;  but  he  objects  to  his  own 
ten  thousand  dollars  being  taken  away,  while  his  neighbors  in 
the  village,  who  are  far  richer  than  he,  pay  no  taxes  at  all.  In 
short,  while  attention  is  directed  to  the  fact  that  land  values  are 
undoubtedly  less  per  acre  in  the  country  than  in  the  city,  it  is  for- 
gotten that  the  number  of  acres  in  the  country  is  so  many  times 
larger  than  the  number  of  acres  in  the  cities  that  the  total  land 
values  in  the  country  will  form  a  large  part  of  the  whole.  More- 
over, we  have  seen  that  the  value  of  improvements  is  greater  in 
the  towns  than  in  the  country.  In  the  country  the  farm-house 
is  built  for  five  hundred  dollars ;  in  the  city  the  fine  stone  man- 
sion or  steel  business  edifice  is  erected  at  a  cost  of  thousands 
or  hundreds  of  thousands  of  dollars.  If,  therefore,  all  im- 
provements were  to  be  entirely  exempted,  the  only  result  of  a 
tax  on  land  values  would  be  to  make  the  farmers  pay  more  than 
they  do  at  present.  It  is  not  denied  that  as  between  the  general 
property  tax  as  actually  administered  and  a  tax  on  real  estate 
only,  the  farmer  would  be  benefited  by  the  adoption  of  the  lat- 
ter. For  personal  property  is  assessed,  chiefly  in  the  agricultural 
communities.  The  remedy,  however,  consists  not  in  taxing 
only  real  estate,  but  in  striving  to  reach  the  abilities  of  the  owners 
of  personal  property  by  some  other  method  than  that  of  the  an- 
tiquated general  property  tax.  But  even  assuming  that  this  re- 
form cannot  be  effected,  what  the  farmers  would  gain  by  the 
abolition  of  the  personal  property  tax,  they  would  lose  and  far 
more  than  lose,  as  we  have  seen,  by  the  total  exemption  of  all 
improvements. 

No  wonder  the  farmers  realize  that  this  will  ruin  them.  Im- 
munity from  indirect  taxes  would  be  dearly  purchased  at  such  a 
price;  for  it  would  result  in  the  destruction  of  the  one  class 
above  all  others  upon  which  our  prosperity  rests  —  the  class  of 
independent  small  farmers.  As  long  as  the  United  States  re- 
mains pre-eminently  an  agricultural  community,  it  is  not  likely 
that  the  Single  Tax  will  become  a  practical  question. 


158  SELECTED   ARTICLES 

Thirdly,  and  finally,  let  us  consider  the  economic  effects  of 
the  Single  Tax  in  rich  urban  communities. 

It  is  contended  by  the  Single  Taxers.  with  special  reference  to 
the  advantages  claimed  as  likely  to  accrue  to  the  tenement-house 
population  of  the  large  cities,  that  the  introduction  of  their  sys- 
tem would  bring  about  the  social  millennium.  It  is  supposed 
that  if  we  abolish  the  tax  on  improvements,  that  is,  on  houses, 
the  vacant  lots  will  be  built  over  as  if  by  magic,  rents  will  fall, 
the  wages  of  the  workmen  will  rise,  and  a  period  of  general 
prosperity  will  be  ushered  in. 

It  may  be  asked,  in  the  first  place,  where  all  this  additional 
capital  which  is  to  be  invested  in  houses  is  coming  from.  There 
is  no  fund  floating  about  in  the  air  which  can  be  brought  to 
earth  simply  by  the  imposition  of  the  Single  Tax;  the  amounts 
to  be  laid  out  in  houses  must  be  taken  from  the  capital  now 
invested  in  some  other  form  of  productive  enterprise.  The 
amount  of  loanable  capital  in  the  money  market  at  any  one  time 
is  definitely  fixed.  Even  deposits  in  banks  are  already  invested, 
for  the  most  part,  in  mortgages  or  in  corporate  securities ;  that 
is,  they  are  already  utilized  for  productive  purposes.  What  is 
put  into  new  houses  will,  therefore,  simply  be  so  much  taken 
away  from  other  productive  employments. 

It  may  be  asked  next,  how  the  rents  of  our  tenement-house 
population  will  be  reduced?  The  theory  that  a  tax  on  houses 
is  shifted  to  the  consumer  or  tenant  is  true  enough,  provided 
that  the  tax  be  exclusive  —  that  is,  provided  that  nothing  be 
taxed  except  houses.  If,  on  the  contrary,  the  house  tax  is  sim- 
ply a  part  of  a  wider  system  of  taxation ;  if  other  forms  of 
property  are  assessed  like  investments  in  land  and  in  personal 
property ;  if  a  corporation  tax  is  imposed  to  hit  the  investors  in 
corporate  securities ;  or  if  we  have  an  income  tax  which  is  to 
reach  general  profits,  —  in  all  these  cases  the  very  conditions  of 
the  theory  according  to  which  a  house  tax  is  shifted  disappear. 
To  the  extent,  then,  that  the  house  tax  is  not  a  Single  Tax,  the 
tendency  for  it  to  be  shifted  will  be  diminished.  The  only  re- 
sult, in  this  direction,  of  the  Single  Tax  would  be,  as  a  matter  of 
fact,  that  people  would  pay  their  rent  to  the  state  instead  of  to 
private  individuals.  We  hear  a  great  deal  about  the  unoccupied 
lands  held  for  speculative  purposes  in  large  cities :  but  it  may 
safely  be  affirmed  that  south  of  Forty-second  Street  in  the  city 


SINGLE   TAX  159 

of  New  York  —  the  home  of  the  major  part  of  the  tenement- 
house  population  —  not  one-fiftieth  of  one  per  cent  of  the  build- 
ing lots  lie  idle,  and  of  these  some  lots  are  occupied  as  coal 
yards,  and  some  adjoining  factories  or  large  establishments  are 
used  for  storage  purposes.  How  then  would  the  Single  Tax  re- 
lieve the  inhabitants  of  the  slums?  They  will  not  go  to  the 
suburbs  where  there  is  an  abundance  of  land,  for  the  same  rea- 
son that  they  do  not  go  there  now.  Rent  in  the  suburbs  is  at 
present  considerably  less  than  in  the  slums,  which  are  neverthe- 
less crowded.  The  average  workman  plainly  prefers  to  be  near 
his  work,  and  to  enjoy  the  social  opportunities  of  contact  with 
his  fellow-workmen,  evenings  as  well  as  day-time.  Above  all, 
he  cannot  afford  the  expenditures  of  time  and  money,  neces- 
sary for  conveying  the  various  members  of  his  family  to  and 
from  the  suburbs.  Even  assuming,  therefore,  that  there  was 
some  magic  fund  to  cover  the  suburban  lots  with  houses,  the 
rents  in  the  slums  would  scarcely  be  affected. 

Finally,  we  may  ask  how  the  wages  of  the  workmen  are  to  be 
increased  by  the  Single  Tax.  Wages  can  be  increased  only 
through  an  increase  in  capital  or  through  an  increase  of  the  effi- 
ciency of  the  laborer.  Taxation  in  itself  cannot  accomplish  either 
of  these  results.  To  turn  economic  rent  over  to  the  state  can- 
not increase  capital  one  whit,  nor  can  it  augment  the  efficiency 
of  the  laborer.  Not  only  can  the  Single  Tax  have  no  influence 
on  the  wages  of  labor,  but  as  we  have  seen  it  cannot  decrease  the 
rentals  of  the  tenement-house  population.  The  whole  fair  dream 
of  economic  felicity  thus  resolves  itself  into  mere  mist,  into  mere 
nothingness ;  the  tenement-house  population  would  derive  as 
little  advantage  as  the  American  farmer  from  the  Single  Tax. 

So  far  as  there  is  any  truth  in  the  doctrine  that  land  in  or  near 
cities  is  largely  held  for  speculative  purposes,  the  difficulty  can 
be  met  by  the  enforcement  of  now  existing  laws.  The  tax  laws 
of  the  American  states  everywhere  instruct  the  officials  to  assess 
property  at  its  true  or  selling  value,  but  it  is  notorious  that  un- 
improved lots  are,  as  a  rule  considerably  undervalued  as  com- 
pared with  those  on  which  improvements  have  been  erected.  If, 
then,  we  simply  enforce  the  laws  as  they  exist,  it  will  be  far  more 
difficult  for  any  one  to  hold  land  on  speculation.  But  the  desired 
purpose  may  be  accomplished  without  invoking  the  aid  of  the 
Single  Tax. 


i6o  SELECTED   ARTICLES 

Furthermore,  so  far  as  there  is  an  element  of  truth  in  the 
idea  of  unearned  increment  as  applied  to  urban  real  estate,  the 
problem  is  already,  to  a  large  extent,  solved  in  America  by  the 
system  of  special  assessments  which  takes  for  public  purposes, 
and  precisely  at  the  time  of  its  creation,  the  increased  value 
which  may  properly  be  said  to  be  due  to  any  positive  action  on 
the  part  of  the  community.  By  enforcing  the  tax  laws  as  they 
exist  to-day  and  by  extending  the  law  of  special  assessments  to 
all  the  cases  which  are  properly  referable  to  the  principle  of 
benefits,  we  shall  do  as  much  as  is  under  existing  conditions 
either  practicable  or  equitable. 

Conclnsioiis 

We  have  studied  the  Single  Tax  from  different  ])oints  of  view  ; 
and  we  have  seen  that  it  is  defective  fiscally,  politically,  morally 
and  economically.  We  have  learned,  first,  that  it  would  be  in- 
elastic, and  that  it  w^ould  intensify  the  inequalities  resulting 
from  unjust  assessments;  secondly,  that  although  itself  proposed 
chiefly  from  social  considerations  it  would  prevent  the  govern- 
ment from  utilizing  the  taxing  power  for  other  social  purposes, 
and  that  it  would  divorce  the  interests  of  the  people  from  those 
of  the  government;  thirdly,  that  it  would  offend  against  the 
canons  of  universality  and  equality  of  taxation,  and  that  it 
would  seriously  exaggerate  the  difference  between  profits  from 
land  and  profits  from  other  sources;  and  finally,  that  it  would 
be  entirely  inadequate  in  poor  and  new  communities,  that  it 
would  generally  have  an  injurious  influence  on  the  farmer,  and 
that  even  in  the  large  urban  centres  it  would  exempt  large 
sections  of  the  population  without  bringing  any  substantial  relief 
to  the  poorer  classes. 

It  is  clearly  impossible  to  discuss  in  this  place  the  wider 
claim  of  the  single-taxers,  that  the  application  of  their  scheme 
would  introduce  the  social  millennium.  If  economists  thought 
that  the  distinguished  single-tax  leader  had  solved  this  prob- 
lem, they  would  enthrone  him  high  on  their  council  scats  ;  they 
would  reverently  bend  the  knee  and  acknowledge  in  him  a  mas- 
ter, a  prophet.  But  when  he  comes  to  them  with  a  tale  that  is  as 
old  as  the  hills ;  when  he  sets  forth  in  his  writings  doctrines  that 
have  long  since  been  refuted;  when  in  his  enthusiasm  he  seeks 
to  impose  a  remedy  which  appears  to  them  as  unjust  as  it  is  one- 


SINGLE   TAX  i6i 

sided,  as  inconsistent  as  it  is  inequitable,  —  they  have  a  right  to 
protest.  This  is  not  the  first  time  that  some  enthusiast  has  sup- 
posed that  he  has  discovered  a  world-saving  panacea.  The  rem- 
ed}^  for  social  maladjustments  does  not  lie  in  any  such  lopsided 
idea ;  the  only  cure  is  the  slow,  gradual  evolution  of  the  moral 
conscience  of  mankind.  We  cannot  solve  the  labor  problem  by 
any  rule  of  thumb.  Every  student  of  history,  of  political  phil- 
osophy, of  economics,  will  tell  us  that  the  progress  of  the  race 
has  been  slow  and  painful ;  that  the  world  has  advanced  step 
by  step ;  and  that  each  successive  step,  to  be  enduring,  must  be 
founded  on  justice.  To  suppose  for  a  moment  that  the  social 
millennium  will  be  ushered  in  by  any  one  sudden  change — 
even  were  the  change  not  so  lamentably  inadequate  as  the  one 
above  discussed — is  an  evidence  not  of  wisdom,  but  of  short- 
sightedness. 

Even  as  a  method  of  tax  reform,  the  scheme  is,  as  we  have 
seen,  a  mistaken  one.  Our  system  of  taxation  is  far  from  being 
ideal,  or  even  comparatively  just;  for  we  are  still  clinging,  in  a 
great  degree,  to  mediaeval  errors.  But  whatever  be  the  much- 
needed  reform,  it  is  safe  to  say  fliat  neither  the  common  pople 
nor  the  student  will  ever  accept  a  scheme  which  is  palpably  un- 
just, which  abandons  the  whole  ideal  theory  of  modern  taxation 
—  that  of  relative  ability  or  faculty  —  and  which  seeks  to  put  the 
burdens  of  the  manv  on  the  shoulders  of  the  few. 


Survey.  31:697-702.   March  7,   1914. 

Halving  the  Tax  Rate  on  Buildings :    Pro  and  Con. 
Edwin  R.  A.   Seligman. 

The  problem  of  municipal  taxation  is  again  to  the  front  in 
New  York.  The  advocates  of  the  scheme  to  lower  the  rate  of 
taxation  on  buildings,  and  to  increase  that  on  land  values,  have 
now  put  their  proposition  in  the  form  of  the  so-called  Herrick- 
Schaap  bill,  which  refers  the  whole  matter  to  a  popular  referen- 
dum. The  agitation  has  been  ingeniously  managed  so  as  to  iden- 
tify it  in  the  popular  mind  with  a  project  for  lowering  rents. 

To  the  average  student  of  politics  this  is  an  interesting  prop- 

13 


i62  SELECTED   ARTICLES 

osition.  It  shows  with  what  ease  an  attempt  can  be  made  to  sim- 
plify complex  problems.  To  the  earnest  investigator  the  matter  is 
much  more  serious.  It  has  long  been  recognized  that  of  all  the 
problems  in  economics  that  of  the  incidence  and  effects  of  taxa- 
tion is  one  of  the  most  subtle  and  difficult.  A  change  in  the 
methods  of  taxation,  far  from  being  so  simple  a  matter  as  the 
advocates  of  the  Herrick-Schaap  bill  imagine,  is  in  reality  a  sub- 
ject which  calls  for  the  most  careful  analysis  and  for  the  most 
accurate  knowledge  of  economic  law. 

The  two  shibboleths  of  the  present  agitation  are  lower  rents 
and  prevention  of  congestion.  It  is  well  known  that  the  people 
behind  the  present  movement  are  the  small  but  active  band  of 
Single-Taxers  whose  ultimate  aim  is  to  levy  taxes  on  bare  land 
values.  In  order,  however,  not  to  affright  the  public,  the  scheme 
is  now  introduced  in  the  guise  of  a  slow,  gradual  reduction  of 
the  tax  on  buildings.  To  the  extent,  of  course,  that  the  change 
is  only  partial,  the  effects,  whether  favorable  or  unfavorable,  will 
be  slight.  In  order,  however,  to  recognize  the  tendency  of  the 
measure  and  to  realize  its  full  import,  we  must  study  the  effects 
of  the  change  as  a  totality,  and  then  subsequently  make  allowance 
for  the  degree  in  which  the  partial  adoption  of  the  scheme  falls 
short  of  the  whole. 

There  are  three  points  of  view  from  which  the  subject  may  be 
approached ;  the  economic  changes,  the  social  changes  in  the 
broader  sense,  and  the  fiscal  changes.  Each  of  these  deserves 
attention. 

The  economic  question  is  that  of  the  shifting  of  the  tax  :  Will 
house  rents  be  lowered?    If  so,  to  what  extent? 

Tenants  and  Taxes 

It  is  an  accepted  generalization  of  economics  that,  other 
things  being  equal,  a  tax  on  the  land  is  not  shifted  to  the  tenant, 
whereas  a  tax  on  buildings  is  ordinarily  shifted.  In  dealing  with 
actual  facts,  however,  we  shall  find  that  the  situation  is  by  no 
means  so  simple. 

The  rental  value  of  a  piece  of  real  estate  is  composed  of  two 
parts,  the  rent  of  the  land  proper  and  the  rent  of  the  house. 
The  land  rent  is  influenced  primarily  by  the  growth  of  popula- 
tion. Land  costs  nothing  to  produce  and  as  population  increases, 
more  and  more  sites  arc  occupied  at  the  fringe  of  the  city,  thus 


SINGLE   TAX  163 

pushing  up  the  vakie  of  the  land  toward  the  central  districts. 
What  is  sometimes  overlooked,  however,  is  that  in  a  city  like 
New  York,  capital  must  often  be  invested  in  order  to  prepare 
the  land  for  building.  On  a  level  stretch  in  some  parts  of  Brook- 
lyn, indeed,  all  that  is  requisite  is  the  insignificant  sum  necessary 
to  take  out  the  earth  for  the  cellar  of  a  frame  house;  and  as 
most  houses  are  built  with  cellars  this  may  well  be  reckoned  as 
a  part  of  the  building  cost.  In  many  sections  of  New  York,  how- 
ever, relatively  large  amounts  must  be  spent  in  order  to  blast 
away  the  hill  or  to  make  the  rock  excavations  for  the  house,  and 
in  still  other  parts  of  town  considerable  sums  are  not  infre- 
quently spent  by  real  estate  companies  for  levelling,  grading,  and 
sewering  the  plots.  To  the  extent  that  capital  is  invested  in  the 
land  we  have  to  deal  with  improvements. 

But  in  our  tax  system,  as  well  as  in  the  contemplated  bill,  by 
improvements  are  always  meant  improvements  on  the  land  and 
not  improvements  in  the  land.  To  the  extent  that  the  improve- 
ments take  place  in  the  land  the  tax  will  be  shifted  to  the  tenant. 
It  does  not  follow,  therefore,  that  if  the  tax  on  land  is  increased, 
the  whole  of  this  increase  will  be  borne  by  the  owner.  So  that 
even  if  we  assume  that  an  exemption  of  houses  from  taxation 
would  in  itself  tend  to  lower  rents,  a  part  of  the  increased  tax 
on  the  land  would  tend  to  be  shifted  to  the  tenant  and  would 
therefore  increase  rents. 

But  let  us  look  now  at  the  proposition  that  an  exemption  of 
buildings  from  taxation  would  in  itself  lower  rents.  The  theory, 
of  course,  is  that  if  the  tax  were  taken  off,  more  houses  would  be 
built  and  the  increased  supply  of  houses  would  lower  rents. 
Furthermore,  it  is  contended  that  the  exemption  of  improvements 
from  taxation  would  lead  to  a  continuous  activity,  and  that  the 
resulting  demand  for  capital  would  continually  raise  wages,  in- 
duce prosperity,  and  increase  population. 

The  question,  however,  presents  itself;  even  if  we  grant  that 
more  houses  will  be  built,  will  the  effect  be  a  permanent  or 
merely  a  temporary  one?  It  is  often  said  that  houses  are  like 
anything  else;  reduce  the  price  and  you  increase  the  consump- 
tion. But  this  statement  fails  to  consider  a  marked  difference 
between  houses  and  other  things.  The  demand  for  most  com- 
modities is  elastic  and  will  increase  almost  without  limit,  pro- 
vided the  price  falls  low  enough.    On  the  other  hand  the  demand 


i64  SELECTED   ARTICLES 

for  houses  is  limited.  If  the  price  of  clothes  falls  considerably, 
people  on  the  margin  will  buy  more  clothes  or  better  clothes; 
and  the  further  the  price  falls  the  more  clothes  they  will 
buy.  But  the  demand  for  houses  is  strictly  limited  by  the 
extent  of  the  population.  ]\Iore  houses  will  not  mean  more 
tenants. 

It  is  indeed  true  that  in  every  large  city  there  is  a  fringe  of 
the  population  composed  of  people  who  do  not  live  in  rooms  of 
their  own,  who  are  boarders  or  lodgers  with  other  people.  If 
more  houses  are  built  and  rents  fall,  these  people  who  have 
hitherto  been  unable  to  occupy  apartments  of  their  own  will  in- 
deed be  put  in  a  position  to  do  so.  But  after  the  slack  has  been 
taken  up,  and  after  all  the  boarders  and  lodgers  are  housed  in 
apartments  of  their  own,  what  will  happen?  To  build  more 
houses  would  simply  mean  to  build  vacant  houses. 

Is  it  not  true,  therefore,  that  as  soon  as  the  interval  has 
elapsed  —  one,  two,  or  three  years,  sufficient  for  the  building  of 
the  additional  houses,  —  the  new  equilibrium  between  housing 
and  population  will  have  been  reached,  and  that  there  will  be  no 
further  demand  for  new  buildings,  except  that  which  comes  from 
ordinary  growth  of  the  population  which  existed  before  the 
change  in  taxation  and  which  will  persist  after  this  change? 
Where  then  will  be  the  continuous  demand  for  new  houses,  for 
new  capital,  and  for  more  labor?  On  the  contrary,  is  it  not 
true  that  the  only  effect  of  a  sudden  exemption  of  houses  from 
taxation  will  mean  a  building  boom  which  will  in  most  cases  be 
apt  to  be  overdone  and  which  will  inevitably  be  followed  by  a 
collapse,  by  a  pricking  of  the  bubble,  with  the  ultimate  result 
that  only  the  normal  number  of  houses  will  thereafter  be  built 
every  year? 

We  have  heard  a  great  deal  about  the  wonderful  effects  of  the 
exemption  of  buildings  in  Vancouver  and  we  have  been  deluged 
with  figures  as  to  the  increase  of  building  operations  and  general 
prosperity.  It  is  indeed  true  that  immediately  after  the  complete 
exemption  of  buildings  from  taxation  in  1910,  there  was  a  great 
building  boom.  The  building  permits  in  Vancouver  amounted  to 
$13,150,365  in  1910,  to  $17,652,642  in  191 1.  and  to  $19,388,322  in 
1912.  Everyone  said,  Lo,  look  at  the  results  of  the  Single  Tax! 
But  what  happened  in  1913?  The  "Single  Tax"  is  still  there, 
but  the  building  permits  fell  to  $10,424,447,  one-half  the  amount 


SINGLE   TAX  165 

in  the  preceding  year  and  very  much  less  than  that  in  1910.  More- 
over, the  permits  for  December,  1912,  amounted  to  $1,530,365  and 
for  December,  1913,  to  only  $175,245,  a  falling  off  of  over  85  per 
cent. 

Of  course  as  a  matter  of  fact  everyone  knows  that  the  in- 
fluence of  taxation  is  subordinate  to  the  wider  and  more  import- 
ant influences  of  general  economic  development  and  that  neither 
the  boom  nor  the  collapse  can  be  ascribed  to  taxation  alone ;  but 
if  our  Single  Tax  friends  will  continue  to  claim  Vancouver  or 
the  other  Canadian  cities  as  an  example  of  the  beneficial  effects  of 
taxation  in  increasing  building  operations,  they  must  take  their 
medicine  and  now  confess  that  the  result  is  just  the  opposite  of 
what  they  claim. 

Even  though,  however,  the  contention  of  general  prosperity 
consequent  upon  the  exemption  of  buildings  is  clearly  disproved, 
it  might  be  claimed  that  the  new  equilibrium  will  be  reached  at  a 
lower  level,  and  that  even  if  there  be  only  a  temporary  boom  in 
buildings,  rents  will  nevertheless,  after  the  collapse,  be  less  than 
before.  Let  us  consider,  then,  whether  there  are  any  counter- 
vailing tendencies  to  oppose  this  trend  to  lower  rents  due  to  an 
increase  in  the  number  of  houses. 

Building  up   the  Suburbs 

In  the  first  place,  is  it  not  true  that  new  houses  are  now  con- 
tinually being  built  on  the  outskirts  by  modest  owners  who  can 
barely  afford  to  do  so,  but  who  expect  to  recoup  their  outlay  and 
to  pay  off  the  indebtedness,  in  part  at  least,  by  the  gradual  in- 
crease in  the  value  of  their  land?  Just  as  the  opening  up  of  our 
western  cities  was  largely  due  to  the  expectation  of  a  profit  to  the 
farmers  through  the  increase  of  land  values,  so  also  it  is  un- 
doubtedly true  that  the  building  up  of  our  suburbs  is  largely 
due  to  this  same  expectation  of  the  so-called  unearned  increment. 
It  is  clear,  however,  that  an  increased  tax  on  land  values  will 
diminish  the  capital  value  of  the  land.  For  if  the  rental  value  of 
land  falls,  its  capital  value  must  fall  accordingly.  To  the  ex- 
tent, then,  that  land  values  will  fall  or  will  be  prevented  from  ris- 
ing, to  that  extent  some  intending  builders  will  be  prevented  from 
building. 

Secondh%  most  houses  are  built  nowadays  on  building  loans 
and  the  amount  of  the  loan,  as  well  as  the  rate  of  interest,  is  in 


i66  SELECTED   ARTICLES 

a  certain  proportion  to  the  value  of  the  land.  If  the  increased 
tax  on  the  land  diminishes  its  value,  cither  less  money  can  be 
borrowed  or  a  higher  rate  of  interest  will  have  to  be  paid,  and  in 
either  case  there  will  be  an  impediment  to  the  erection  of  new 
houses.  In  the  present  state  of  slack  building  in  New  York  any 
doubt  cast  on  the  underlying  security  for  the  mortgage  will  ser- 
iously check  the  free  flow  of  loanable  funds  and  to  that  extent 
hinder  the  development  of  building  operations. 

Thirdly,  it  is  clear  that,  as  stated  above,  land  rent  increases 
with  every  enlargement  of  the  circumference  of  the  city.  In  a 
small  town  with  few  people,  rents  in  the  center  are  low.  As  the 
population  increases  and  the  building  zone  widens,  land  rents  will 
rise  until  in  a  large  metropolis,  like  New  York,  land  values  vary 
from  agricultural  farm  values  at  the  outskirts  up  to  thousands  of 
dollars  per  front  foot  in  the  center.  If,  now,  it  is  true,  as  our 
Single  Tax  friends  contend,  that  the  contemplated  change  of  tax- 
ation will  mean  the  building  of  more  houses,  and  therefore  the 
pushing  out  of  the  building  periphery,  will  it  not  necessarily  fol- 
low that  land  rents  will  rise  accordingly?  It  may  indeed  be  con- 
ceded that  if  the  new  houses  were  built  on  vacant  plots  toward 
the  centre,  the  pressure  on  the  previously  improved  plots  would 
be  relieved.  But  as  soon  as  these  vacant  sites  were  improved, 
and  the  building  zone  in  general  was  extended,  land  rents  to- 
ward the  centre  would  surely  rise.  The  enlargement  of  the 
building  zone,  therefore,  will  cause  land  rents  to  rise  throughout 
the  city,  and  the  lowering  of  the  building  rent  will  tend  to  be 
compensated,  in  part  at  least,  by  the  rise  of  land  rent,  —  making 
the  total  rent  paid  by  the  tenant  little,  if  any,  less  than 
before. 

Finally,  fourthly,  the  ordinary  argument  adduced  to  prove  that 
rents  in  the  slums  will  fall  is,  that  if  people  can  now  after  the 
change  of  taxation  secure  better  accommodations  in  the  suburbs, 
the  owners  in  the  slums  will  be  compelled  to  reduce  their  rents 
or  have  their  houses  go  empty.  It  must  not  be  forgotten,  how- 
ever, that  there  is  much  less  mobility  than  is  usually  alleged. 
Rents  in  the  suburbs  are  now  lower  than  they  are  in  the  slums, 
and  yet  people  continue  to  live  in  the  slums  partly  because  of 
proximity  to  their  work,  but  chiefly  because  of  the  social  advan- 
tages, or  fancied  advantages,  of  the  neighborhood  itself.  It  will 
therefore  take  a  very  great  change  in  conditions  at  the  fringe  in 


SINGLE   TAX  167 

the  suburbs  before  an  appreciable  effect  is  produced  in  the  cen- 
ter of  the  city.* 

Taking  all  these  points  together,  it  will  be  seen  how  far  from 
simple  is  the  process  and  how  far  from  sure  is  the  alleged  conse- 
quence that  house  rents  will  fall.  At  the  very  best,  even  with 
the  total  exemption  of  buildings  from  taxation,  house  rents  will 
fall  by  much  less  than  the  amount  of  the  tax;  and,  owing  to 
the  reasons  mentioned  above,  it  is  not  sure  that  they  will  fall  at 
all.     The  popular  cry  of  lower  rents  is  far  from  exact. 

Let  us  now  consider  a  little  more  in  detail  the  social  conse- 
quences or  alleged  consequences  of  such  a  change  in  taxation. 
These  social  consequences  may  be  discussed  under  three  heads: 
congestion,  the  relative  advantages  to  rich  and  poor,  and  social 
justice. 

Congestion 

By  congestion  we  may  mean  two  entirely  distinct  things : 
either  density  of  population  per  room,  or  density  of  population 
per  acre.  Even  if  we  grant,  for  the  sake  of  argument,  that 
house  rents  will  fall  slightly,  thus  enabling  more  people  to  live 
in  separate  apartments  and  thus  reducing  the  density  per 
room,  does  it  follow  that  there  will  be  a  decrease  in  the  popula- 
tion per  acre.   And  if  not,  which  congestion  is  to  be  preferred? 

If  buildings  are  exempted  from  taxation  there  will  manifestly 
be  every  inducement  to  prospective  builders  to  enlarge  their 
profits  by  increasing  the  height  of  buildings.  They  will  not  build 
better  buildings  because  there  will  be  no  demand  for  rooms  at 
the  increased  rental  in  that  neighborhood.  They  will  therefore 
build  higher  structures,  each  apartment  of  which  will  rent  at  the 
customary  figure.  As  a  result,  the  old  and  low  buildings  in  the 
slums  will  be  replaced  by  high  apartment  houses,  each  of  which 
may  house  two  or  three  times  as  many  people  as  before.  The 
consequence  will  be  a  great  increase  in  the  density  per  acre, 
with  all  the  resulting  discomforts  and  dangers  in  the  streets  and 
consequent  need  of  spending  still  more  money  for  parks  and  open 
spaces. 

It  might  be  claimed,  however,  that  this  consequence  can  be 
averted   by  a  law  limiting  the   height  of  buildings.    But   in   the 

*  For  a  scientific  discussion  of  this  point  see  Seligman,  The  Shifting 
and  Incidence  of  Taxation,  3rd  ed.,  1910,  pp.  313  et  seq. 


i68  SELECTED   ARTICLES 

first  place  it  must  be  pointed  out  that  there  is  no  such  proposition 
in  the  present  scheme,  so  that  it  must  stand  on  its  cnvn  merits; 
and  secondly,  even  if  such  a  building  law  were  passed  it  would 
help  matters  very  little.  A  very  small  proportion  of  the  existing 
tenement  population  lives  at  present  in  buildings  of  the  maxi- 
mum height.  A  rebuilding  of  the  city  even  with  buildings  limited 
to  the  maximum  height  would  cause  a  congestion  per  acre  far 
greater  than  anything  that  now  exists.  Not  only  would  there  be 
no  small  houses,  but  there  would  be  no  coal  yards,  no  wood 
sheds,  nothing  to  break  the  monotony  of  tenements. 

Moreover,  a  similar  situation  will  ensue  in  the  rest  of  the 
city.  The  tendency  of  an  increased  tax  on  land  values  must  al- 
ways be  a  more  extensive  utilization  of  the  land.  This  will 
mean  a  more  compactly  built  city  than  at  present.  Instead  of 
little  houses  with  gardens  around  them,  such  as  we  see  now  in 
outlying  districts,  and  even  in  some  of  the  more  densely  popu- 
lated parts  of  Brooklyn,  we  shall  have  a  repetition  throughout 
the  whole  length  and  breadth  of  the  city  of  conditions  that  we 
find  in  Manhattan.  The  congestion  in  Manhattan  was  produced 
by  the  configuration  of  the  island.  Have  we  not  a  right  to  look 
forward  to  a  situation  in  other  boroughs  comparable  to  that  in 
residential  districts  of  most  American  cities?  Will  not  the  ex- 
emption of  buildings  from  taxation  and  the  increased  tax  on 
land  stop  that  tendency?  We  must  answer,  unfortunately,  yes. 
It  will  mean  no  open  spaces;  it  will  mean  no  gardens  around  the 
houses;  it  will  mean  house  next  to  house,  and  apartment  by 
apartment;  it  will  mean  in  short  a  repetition  of  all  the  worst 
evils  of  the  slums  spread  throughout  the  entire  city.  Land  specu- 
lation may  have  its  abuses;  but  this  evil  at  least  it  avoids.  An 
unbuilt  lot  may  seem  in  some  respects  a  waste ;  but  at  least  it  af- 
fords fresh  air,  and  sunlight  and  grateful  space. 

Is  this  kind  of  congestion  not  really  worse  than  the  conges- 
tion per  room?  Is  it  wise  to  purchase  what  is  at  best  a  dubious 
relief  from  the  congestion  per  room  at  the  cost  of  a  very  certain 
increase  In  the  congestion  per  acre?  Is  It  not  true,  as  Bastlat 
said,  that  we  must  distinguish  between  the  seen  and  the  unseen? 
The  enthusiastic  advocates  of  opposition  to  congestion  fail  to 
see  that  they  are  tending  to  produce  a  worse  congestion  than  the 
one  they  attempt  to  relieve. 

The  true  remedy  for  congestion  is  not  any  change  In  taxation. 


SINGLE   TAX  169 

The  true  remedy  for  congestion  consists  in  ample  facilities  for 
transportation;  in  laws  to  restrict  the  height  and  the  depth  of 
buildings;  in  broad  streets  and  numerous  parks  and  playgrounds 
scattered  over  every  part  of  the  city.  The  first  two  will  relieve 
congestion  per  room ;  the  last  will  relieve  congestion  per  acre. 
But  a  change  in  the  tax  laws  will  have  a  most  insignificant  effect 
on  the  one,  and  will  have  the  opposite  of  a  beneficial  effect  on 
the  other. 

The  second  point  is,  who  will  derive  the  social  benefits  of  this 
change  in  taxation,  the  rich  or  the  poor?  The  poor,  as  we  have 
seen,  will  secure  little,  if  any,  decrease  of  rents;  and  what  they 
possibly  gain  by  a  decrease  of  rents,  they  will  lose  by  an  increase 
in  congestion  per  acre.  How  is  it,  however,  with  the  other 
class  of  population?  Take  the  typical  rich  man  who  builds 
himself  a  fine  mansion  on  Fifth  Avenue  for  his  own  residence. 
Is  he  a  representative  of  a  class  that  needs  special  favors  from 
the  community?  It  may  be  said  indeed  that  a  fine  mansion  is 
generally  erected  on  expensive  ground  and  that  under  the  new 
scheme  he  will  pay  as  much  more  for  the  land  as  he  pays  less  for 
the  mansion.  But  that  assumes  that  the  land  is  worth  as  much 
as  the  house.  We  all  know  that  that  is  not  the  case,  and  that 
the  more  sumptuous  residences  are  precisely  those  that  cost  more 
than  the  land  on  which  they  stand. 

The  Rich  Favored 

On  what  theory  then,  shall  these  rich  men  be  favored?  Cer- 
tainly it  cannot  be  on  the  theory  that  people  should  pay  in  accord- 
ance with  their  ability  to  pay;  for  according  to  that  theory 
the  rich  man  ought  to  pay  more  than  the  others,  not  less.  It 
will  be  said,  however,  that  the  true  basis  of  local  taxation  is  the 
theory  of  benefits  and  not  the  theory  of  ability. 

Accepting  that  claim  for  the  sake  of  argument,  what  would  be 
the  result?  Shall  we  say  that  the  owner  of  the  palace  or  of  the 
Woolworth  building  derives  no  benefits  from  the  city  administra- 
tion to  incur  no  expense?  How  about  fire  protection?  The 
land  cannot  be  destroyed,  but  the  house  can.  How  about  police 
protection^  The  land  cannot  be  taken  away,  but  you  may  rifle 
the  contents  of  the  building,  and  so  on.  Is  it  not  clear  that  the 
exemption  of  buildings    from  taxation  or  a  lower  tax  rate  on 


170  SELECTED   ARTICLES 

buildings  gives  an  unfair  advantage  to  tlie  very  rich  rather  than 
to  the  very  poor? 

And  if  we  pass  from  a  consideration  of  the  owners  of  these 
line  buildings  to  that  of  the  tenants  what  do  we  find?  In  the 
skyscrapers  downtown  are  lodged  the  big  banks,  the  big  trust 
companies,  the  big  lawyers,  the  big  financial  and  business  enter- 
prises of  all  kinds.  At  present  if  we  assume  that  the  tax  on  the 
house  is  shifted  to  them,  they  pay  at  least  something  to  the  ex- 
penses of  the  city  government.  Under  the  new  scheme  they 
would  be  totally  exempt.  In  the  skyscraper  we  find  most  of  the 
money-making  agencies  of  the  city,  and  yet  it  is  seriously  pro- 
posed to  exempt  all  these  from  any  contribution  to  the  city  ex- 
penses, even  that  indirect  contribution  which  they  pay  in  the 
shape  of  rent. 

Take  the  statistics  of  new  buildings  that  are  constructed  in 
any  large  city.  You  will  find  that  to  an  overwhelming  extent 
they  represent  valuable  opportunities  for  the  larger  business  men 
and  for  the  wealthier  residents.  The  amount  of  new  construc- 
tion, which  consists  of  tenement  houses,  or  cheap  apartment 
houses,  and  of  small  residential  buildings,  is  an  insignificant  pro- 
portion of  the  whole.  Will  the  small  man,  then,  really  get  the 
benefit  of  the  change? 

Let  us  take  next  the  great  mass  of  moderately  comfortable 
.people,  neither  the  very  rich  nor  the  very  poor,  and  consider 
how  they  will  be  affected. 

In  many  parts  of  the  residential  sections  of  New  York  the 
land  is  worth  more  than  the  improvements.  We  are  told  that 
the  average  of  land  values  in  New  York  is  63  per  cent  and  that 
in  some  of  the  residential  sections  it  rises  to  70  per  cent  and 
in  some  cases  even  to  80  per  cent.  What  now  will  be  the  effect 
of  this  change  in  taxation  upon  the  great  mass  of  modest  house 
owners  where  the  land  has  come  after  some  years  to  be  worth 
more  than  the  house?  These  house  owners  have  not  any  larger 
income  than  before  and  they  are  perhaps  just  about  able  to  live 
comfortably  on  their  present  income. 

The  change  in  the  rate  of  taxation  will  impose  an  additional 
burden  upon  them  and  will  tend  to  force  out  of  their  houses  all 
those  who  are  on  the  fringe.  As  they  are  forced  out  of  their 
homes  the  land  will  be  put  to  the  most  intensive  use  and  their 
houses   will    be   replaced   by   lofty   apartments.     Thus    gradually 


SINGLE   TAX  171 

from  a  city  of  modest  home  owners  we  shall  be  converted  into  a 
town  of  apartment-  and  flat-dwellers.  This  transition  may  be 
inevitable,  but  why  hasten  it  by  artificial  means? 

Not  only  will  the  rich  man  be  favored  and  the  modest  house- 
owner  be  injured  but,  in  the  third  place,  what  will  be  the  effect 
upon  property  holders  in  general,  whether  rich  or  poor?  It  is 
claimed  that  the  object  of  the  proposed  scheme  is  to  do  away 
with  speculation  in  land.  Now  I  hold  no  brief  for  land  specu- 
lators, although  I  think  that  they  are  a  much  maligned  class  and 
that  we  have  made  of  the  land  speculator  a  bugaboo  just  as  the 
ordinary  man  in  the  west  had  made  of  the  New  York  Stock 
Exchange.  Speculation  has  its  good  sides  and  its  bad  sides.  It 
has  its  uses  and  its  abuses.  There  is  an  economic  utility  in  land 
speculation  as  there  is  an  economic  utility  in  stock  exchange 
speculation.  That  there  are  evils  not  to  be  overlooked  is  plain 
and  that  our  former  system  of  under-assessing  vacant  lands  de- 
veloped great  abuses  of  land  speculation  is  equally  undoubted. 
But  is  it  not  a  mistake  to  identify  all  landowners  with  land 
speculators  ? 

My  objection  to  the  present  scheme  as  well  as  to  the  Single 
Tax  does  not  rest  on  any  opposition  to  the  taxation  of  real 
estate  or  on  any  desire  to  minimize  the  desirability  of  taking  for 
the  public  some,  at  least,  of  the  increase  in  land  values.  I  think 
that  a  fair  case  might  be  made  out  not  only  for  having  the 
weight  of  local  taxation  rest  primarily  on  real  estate,  but  also  for 
a  land  increment  value  tax,  to  be  added  to  our  present  taxes 
just  as  Germany  and  England  have  done.  But  the  essential 
difference  between  such  a  scheme,  which  is  not  now  before  us, 
and  the  present  project  is,  that  the  other  plan  deals  only  with 
future  increases  of  value,  while  this  scheme  deals  with  present 
values. 

I  have  never  been  able  to  understand  why  a  man  who  has 
invested  in  land  should  be  exposed  to  the  danger  of  having  a 
part  of  his  property  taken  away  from  him?  When  he  invested 
his  money  in  land  it  was  on  the  basis  of  the  accepted  policy  of 
social  justice,  that  private  property  in  land  was  to  be  treated  like 
private  property  in  other  things.  The  landowner  in  New  York 
city  today  is  not  simply  a  speculator  nor  is  he  always  a  rich 
man.  There  are  numberless  modest  landowners  and  numberless 
men    in   modest   circumstances   who    own    shares   in   real   estate 


172  SELECTED    ARTICLES 

companies.  Why  should  the  selling  value  of  their  land  be  so 
diminished  by  an  act  of  government  that  a  part  of  their  property 
is  confiscated?  Does  it  not  run  counter  to  our  very  ideas  of 
social  justice  and  of  equality  of  taxation? 

Of  course,  those  who  hold  that  there  are  no  vested  rights  in 
land  would  brush  aside  this  argument;  but  I  fancy  that  the  com- 
mon sense  of  most  people  is  not  yet  ready  to  go  to  the  length 
of  accepting  the  bald  proposition  that  the  state  has  a  right  to 
take  away  a  man's  property  without  compensation. 

It  is  claimed  again  that  this  particular  project  will  be  so 
gradual  in  operation  that  there  will  be  no  net  diminution  in  land 
values,  because  the  increased  value  due  to  the  normal  growth  of 
population  will  more  than  offset  the  diminished  value  due  to 
capitalization  of  the  tax.  This  position  might  be  tenable  in  case 
all  land  increased  equally  in  value  throughout  the  city.  But  we 
know  from  experience  that  this  is  not  the  fact;  that  some 
sections  increase  in  value  while  other  sections  remain  stationary 
or  even  decrease  in  value.  As  to  all  the  unfortunate  property 
owners,  and  there  are  many  of  them,  situated  in  such  sections, 
the  objection  therefore  would  not  be  removed. 

Fiscal  Aspects 

Thus  we  see  that  while  the  poor  tenant  would  receive  little, 
if  any,  advantage,  the  rich  man  and  the  great  business  magnate 
would  be  unduely  favored,  and  the  modest  house  owner  and  the 
not  inconsiderable   number  of   ordinary  land   owners   would   be  . 
distinctly  injured. 

We  come,  finally,  to  the  fiscal  aspects  of  the  problem.  In 
considering  these  we  must  bear  in  mind  that  while  land  values 
will  be  lowered,  land  rents  will  not  be  less  than  before. 

The  rent  of  land,  that  is,  the  amount  paid  by  the  tenant,  is  a 
gross  sum,  and  depends  entirely  upon  the  growth  of  population. 
The  rental  value  of  land  to  the  owner  is  a  net  sum,  that  is,  it  is 
the  rent  paid  by  the  tenant,  less  the  taxes  and  other  expenses,  if 
any,  in  managing  the  land.  The  selling  value  of  anything  is 
always  the  capitalization  of  the  net  rent.  Consequently,  the 
higher  you  make  the  tax  on  land,  the  lower  you  make  the  value 
of  land,  without  affecting  in  one  iota  the  rent  paid  by  the  tenant. 
If  the  entire  net  vield  of  the  land  were  taken  by  the  state,  the 


SINGLE   TAX  173 

land  would  not  be  worth  anything  to  own;  but  the  rent  to  the 
tenant  would  be  just  as  high  as  before,  the  only  difference  being 
that  now  the  tenant  would  virtually  pay  rent  to  the  state  in  the 
form  of  taxes  transmitted  through  the  landlord. 

If  this  principle  is  kept  clearly  in  mind,  we  can  see  what  the 
results  of  the  tax  would  be.  Obviously  the  base  of  revenue 
would  be  more  restricted.  If,  instead  of  taxing  both  lands  and 
houses,  we  tax  only  lands,  we  have  less  to  tax;  and  if,  in 
addition,  the  selling  value  of  the  land  is  now  diminished,  we  have 
doubly  less  to  tax  than  before. 

What  we  need  in  our  large  cities  is  more  revenue,  not  less 
revenue.  Does  it  not  seem,  then,  to  be  a  very  questionable 
scheme  to  endeavor  to  raise  more  revenue  by  narrowing  the  base 
of  taxation. 

But  not  alone  would  the  system  fail  to  respond  to  our  need 
for  an  increased  revenue ;  it  would  probably  be  hazardous.  Taxes 
are  almost  everyw^here  limited  to  a  certain  percentage  of  the 
property  taxed.  In  New  York  city  this  limit  is  fixed  at  two  per 
cent,  exclusive  of  the  debt  charge.  Is  it  not  clear  that  if  the 
thousands  of  millions  of  dollars  invested  in  houses  are  exempted 
from  taxation,  the  rate  on  the  land  would  have  to  be  raised  so 
as  to  approach  dangerously  close  to  the  limit,  if  not  in  fact  to 
exceed  it.  The  contention  that  it  would  be  possible  to  reduce 
the  rate  on  houses  and  at  the  same  time  still  keep  them  on  the 
assessment  lists  at  full  value,  is  not  tenable.  Either,  therefore, 
the  Constitution  will  have  to  be  changed,  or  the  tax  limit  raised. 


Charles  H.  Shields.     Single  Tax  Exposed. 

All  Property  of  Exchangable  Value  Should  Be  Taxed. 

Under  our  present  system  and  present  land  laws,  land  is 
property,  and  I  hold  that  private  property  in  land  is  consistent 
with  and  necessary  to  man  in  a  state  of  civilization.  Under  our 
present  system  of  exchange  which  is  the  product  of  civilization 
and  the  outgrowth  of  the  division  of  labor,  we  have  several 
classes  of  property.  Land  owned  by  individuals  may  be  con- 
sidered first  as  it  is  upon  land  and  land  values,  home  values, 
that  all  other  industries  rest.     Cattle  and  other  animals  that  are 


174  SELECTED   ARTICLES 

bought  and  sold  on  account  of  their  usefulness  for  food  or 
otherwise,  may  be  classed  as  another  kind  of  property.  Stocks, 
bonds  and  obligations  to  pay  may  be  classed  as  another  kind. 
The  products  of  the  soil,  coupled  with  labor,  form  another  class. 
Goods,  wares  and  merchandise,  manufactured  articles  of  all 
kinds,  whether  mnnufactured  by  machinery  or  by  hand,  consti- 
tute another  class.  Books  containing  the  mental  efforts  and 
energy  of  individuals  may  be  classed  as  another  kind  of  property. 
All  the  property  coming  under  the  various  classifications  are 
essential  to  man  in  a  state  of  society.  One  is  exchangeable  for 
another  by  and  through  the  process  of  our  system  of  exchange. 
If  an  individual  desires  a  manufactured  article  of  any  descrip- 
tion, he  may  sell  the  product  of  his  labor,  or  may  exchange  an 
article  of  value  that  he  has  for  money  which  is  the  blood  of 
commerce,  and  with  that  money  purchase  any  other  article  he 
may  desire  that  is  obtainable.  The  various  articles  which  may  be 
considered  the  product  of  man  are  the  result  of  the  requirements 
of  society.  Consequently  they  are  in  demand.  Therefore  they  are 
exchangeable  for  other  commodities  that  are  in  demand,  accord- 
ing to  the  tastes  and  desires  of  the  various  individuals  of  society 
which  are  extremely  numerous.  When  an  article  is  no  more 
desired  by  society,  the  manufacture  of  it  ceases,  and  in  its  place 
a  more  important  article  is  manufactured.  Thus  the  process  of 
the  growth  and  demand  of  the  hundreds  of  thousands  of  various 
manufactured  articles  desired,  and  even  necessary,  for  man  in 
a  state  of  society.  If  an  individual  has  money,  he  will  have  no 
difficulty  whatever  in  finding  others  who  own  land,  to  part  with 
that  land  for  a  certain  amount  of  his  money. 

Hence  it  should  be  obvious  to  the  reader  that  all  kinds  of 
property  which  are  desired  by  society  and  which  can  be  ex- 
changed, one  for  another,  should  be  treated  alike  in  the  eyes  of 
the  law.  Any  discrimination  against  one  kind  of  property  would 
have  a  tendency  to  injure  that  particular  class. 

It  would  be  perfectly  natural  for  an  individual  to  desire 
and  hold  that  class  of  property  that  was  favored  by  law.  Mr. 
George  reasoned  this  out.  Therefore  he  schemed  to  discriminate 
against  land,  and  by  the  process  of  this  discrimination  force  land 
back   into   the   hands   of   the   government. 

As  long  as  we  treat  land  as  property,  there  should  be  no 
discrimination    against    it.    There    is    no    justice    in    placing    the 


SINGLE   TAX  175 

burden  of  taxation  upon  land.  There  could  be  but  one  reason 
for  it,  namely,  that  of  discriminating  against  it  and  finally 
confiscating  the  present  values  of  it. 

Henry  George  claims  that  man  is  a  land  animal  and  therefore 
cannot  live  without  the  use  of  the  land,  and  that  the  land  should 
belong  to  all  of  the  people  because  of  man  being  a  land  animal ; 
that  man  can  no  more  live  without  the  use  of  the  land  than  he 
can  live  without  air  and  water.  Therefore  land  should  be  free 
as  air  and  water.  Of  course  we  agree  with  Mr.  George  that 
man  is  a  land  animal,  and  that  he  can  not  subsist  without  the 
products  of  the  soil  any  more  than  he  could  live  without  free 
access  of  air  and  the  use  of  water.  That  is  no  argument  against 
the  private  ownership  of  land.  Mr.  George  says  that  the  man 
who  owns  the  land  under  our  present  system  virtually  owns 
those  who  must  occupy  the  land.  He  fails  to  recognize  that 
man  is  a  social  as  well  as  a  land  animal,  and  that  social  condi- 
tions are  as  necessary  for  man  in  a  state  of  society  as  the  use  of 
the  land  or  the  air  and  the  water.  In  order  to  get  this  thought 
more  clearly  before  the  reader  it  will  be  necessary  to  go  back 
into  the  early  history,  in  fact,  beyond  the  period  when  there 
was  history,  to  show  the  progress  and  growth  of  society. 

To  illustrate  this  thought  we  will  concede  that  land  is  the 
hub  of  the  wheel  of  society.  Man  must  draw  his  support  from 
the  land;  that  in  his  undeveloped  state— in  his  tribal  state, 
land  was  practically  the  only  essential  to  his  well-being;  but 
when  the  division  of  labor  was  first  adopted,  social  progress 
then  commenced.  When  man  evoluted  to  that  state  of  intelli- 
gence where  he  saw  that  a  division  of  labor  was  better  for 
his  well-being,  the  fisherman  said  to  the  rude  boat-builder, 
"You  build  the  boats  and  I  will  fish;"  and  these  two  said  to 
a  third,  "You  till  the  soil  while  one  builds  the  boat  and  another 
fishes;"  and  to  the  fourth,  "You  make  the  bows  and  arrows, 
while  the  fifth  will  do  the  hunting;"  and  to  the  sixth,  "You 
make  the  crude  implements  necessary  to  till  the  soil." 

And  so  this  division  of  labor  grew,  as  man  progressed  in- 
tellectually and  socially.  It  has  been  a  long  continuous  growth, 
and  each  and  every  new  invention  has  added  to  the  wants  of 
man,  and  has  therefore  become  a  necessity  in  the  state  of 
society  that  he  then  or  now  exists  in.  This  process  has  gone 
on  and   on.    The   greater  the    wants   of  society,   the   greater  the 


176  SELECTED   ARTICLES 

division    of    labor;    and    the    greater    the    division   of    labor,    the 
greater  were  the  wants  of  society. 

Now,  the  various  lines  of  industry,  the  various  articles  of 
wearing  apparel,  the  many  thousand  articles  of  value  that 
are  desired  by  the  mdividuals  of  society,  form  the  other  por- 
tions of  the  wheel.  Machinery  of  all  description  that  is  today 
used,  transportation  facilities,  great  manufacturing  plants,  banks, 
telephone  and  telegraph  system,  in  fact,  the  whole  super- 
structure of  society  are  the  spokes,  the  felloes  and  tire  of  the 
wheel.  Now  I  submit  to  you:  Is  the  land  which  we  have  desig- 
nated the  hub  of  any  greater  importance  to  man  in  a  state  of 
society  than  the  numerous  other  factors  which  we  have  just  enu- 
merated, and  which  we  may  call  the  spokes,  the  felloes  and  tire 
of  the  wheel?  The  hub,  or  the  land,  would  supply  the  wants  of 
man  in  a  state  of  savagery,  but  not  in  a  state  of  development.  For 
this  reason  I  hold  that  there  may  be  many  thousand  lines  of 
pursuits  of  trade  and  combination  of  various  interests  that 
may  be  promoted  by  individuals,  that  could  be  of  more  harm 
to  society  than  any  possible  monopoly  of  land. 

Under  our  system  of  exchange,  as  before  stated,  if  one 
accumulated  goods  or  money,  they  could  at  any  time  convert 
it  into  land.  There  is  no  monopoly  of  land.  The  majority  of 
people  who  own  land  are  perfectly  willing  to  let  it  go  for  a 
fair  consideration.  They  can  take  the  money  and  engage  in 
other  pursuits  that  are  equally  as  profitable  as  that  of  tilling 
the  soil,  and  much  more  pleasant.  As  a  matter  of  fact,  if  you 
would  today  divide  the  land  in  the  United  States  and  give  each 
individual  their  portion,  it  would  not  be  twenty-five  years 
until  conditions  would  be  about  the  same  as  they  are  today. 
Those  who  wanted  to  experiment  and  were  not  satisfied  with 
the  tilling  of  the  soil  would  sell  their  land.  One  would  want  to 
go  into  a  grocery  store,  or  perhaps  he  would  want  to  go  into 
the  automobile  business.  Another  would  want  to  sell  his  land 
and  go  into  the  city  where  he  could  have  the  greater  pleasures 
of  society;  where  he  could  wear  fine  clothes  and  make  a  good 
appearance,  at  least  while  his  money  would  last.  Others  would 
want  to  convert  their  land  into  money  and  travel,  they  would 
want  to  see  the  sights  of  the  cities  and  perhaps  of  foreign 
countries;  and  so  on,  until  each  and  every  one  satisfied  to 
the  extent  of  their  ability  so  to  do,   their  curiosity,  their  pecu- 


SINGLE   TAX  177 

liar  desires,  their  peculiar  ideas,  etc.  A  majority  of  them  would 
prove  a  failure  in  the  enterprise  in  which  they  embarked. 
Ninety  per  cent  of  the  business  enterprises  undertaken  prove 
failures.  These  people  then  would  not  be  the  possessors  of 
soil.  They  would  have  spent  their  money.  Ninety  per  cent  of 
their  undertakings  have  failed,  therefore  they  would  be  in  what 
we  call  the  working  classes.  This  would  be  the  process  of 
working  back  to  the  present  state  of  aflfairs. 

It  is  folly  to  argue  as  the  Single  Taxer  does— that  improvi- 
dence, bad  judgment,  ill  health,  intemperance,  insobriety,  stup- 
idity, vicious  temperament,  ignorance,  laziness,  dishonesty,  bad 
management,  diseased  brains,  physical  and  intellectual  delin- 
quency, lack  of  foresight  and  other  imperfections  of  mind  and 
body  that  could  be  mentioned,  can  be  overcome  and  righted 
by  an  act  of  legislation.  All  the  physical  and  mental  ailments 
above  recited  play  their  part  in  the  unequal  distribution  of 
wealth;  they  play  their  part  and  are  responsible  for  the  many 
sad  conditions  that  we  see  in  society.  Mr.  George  would  hat^e 
you  believe  that  all  of  these  ills  are  traceable  to  and  have 
their  being  in  the  private  ownership  of  land. 

As  long  as  we  have  the  various  stages  of  intellectuality  we 
may  expect  to  have  a  like  variation  In  the  possession  of  prop- 
erty. Any  legislation  seeking  to  restrict  the  advancement  of 
one  because  others  are  unfortunate  and  cannot  keep  up  with 
those  who  are  in  the  advance,  would  have  a  tendency  to  hold 
all  down  alike,  therefore  would  destroy  all  ambition  to  advance. 
The  lower  down  in  the  scale  of  humanity  you  go,  the  nearer 
you  come  to  an  equality.  I  should  like  very  much  to  see  the 
ills  of  society  abolished  were  it  possible.  We  must  not,  how- 
ever, allow  our  emotion  and  our  sympathy  to  distort  and  warp 
our  judgment.  The  law  of-  the  survival  of  the  fittest  seems  to 
hold  good  in  all  mineral,  vegetable  and  animal   creation. 

Henry  George  tried  to  figure  out  a  system  that  would  make 
all  men  equal.  In  doing  so  he  failed  to  recognize  that  the  great 
inequalities,  both  social  and  financial,  are  very  largely  due 
to  the  differences  between  individuals,  not  that  the  possessor 
of  vast  wealth  is  wiser  or  has  more  brains  than  those  who 
have  no  possession  whatever,  for  such  is  not  the  case.  The 
philosopher  is  seldom  a  rich  man.  The  professors  of  our  uni- 
versities are  seldom  rich  men.   The  great  thinkers   of  our  age 

14 


178  SELECTED   ARTICLES 

are  not  rich  men.  They  have  used  their  talents  for  the  acqui- 
sition of  knowledge.  The  same  is  true  of  musicians,  physi- 
cians and  surgeons.  They  have  used  their  time  and  energy  in 
becoming  skilled  in  the  arts  of  music  and  human  anatomy. 
The  same  may  be  said  of  great  sculptors  and  painters  and  of 
clergymen,  scientists  and  political  economists.  They  have  given 
their  time  and  energy  to  tlie  acquisition  of  knowledge.  There- 
fore they  have  but  little   of  the   worldy   possessions. 

I  believe  enough  has  been  said  along  this  line  to  give  the 
reader  a  clear  insight  into  social  conditions ;  that  enough  has 
been  said  to  show  clearly  that  no  process  of  taxation,  and 
especially  that  of  Single  Tax,  which  would  confiscate  all  private 
property  in  land,  thereby  destroying  the  very  foundation  upon 
which  civilization  has  advanced,  can  ever  bring  about  the 
extirpation  of  pauperism  and  the  equalization  of  the  distribu- 
tion  of  wealth. 

Society  will  always  have  its  troubles  as  long  as  there  is 
such  a  vast  difference  in  human  nature.  The  great  readers 
along  the  line  of  political  economy  have  recognized  this  fact. 
Herbert  Spencer  when  a  young  man,  reasoning  without  experi- 
ence, attempted  to  write  a  purely  ethical  work  on  political  eco- 
nomy. The  title  of  the  work  was  "Social  Statics."  He  advo- 
cated the  nationalization  of  land  by  compensating  the  owners, 
for  their  land.  After  forty  years  of  experience,  when  his 
judgment  was  tempered  by  the  cold,  stubborn  facts  and  reali- 
ties of  life,  he  came  to  the  conclusion  that  his  early  writings 
were  wrong,  and  in  speaking  of  the  nationalization  of  land  he 
says  : 

"Until  there  is  a  great  change  in  human  nature,  the  nation- 
alization  of  land  would  be  impracticable." 


National   Tax    Association    Proceedings.    1913-    !'•    129-32. 

Single  Tax  in  Canada.  Adam  Shortt. 

I  have  noticed  in  a  good  many  American  publications 
reference  to  the  experiences  of  Canada  in  the  way  of  a  Single 
Tax,  particularly  the  laws  adopted  in  our  western  provinces, 
and  it  occurs  to  me  that  a  word  might  be  put  in  here  with  refer- 
ence to   the  actual   results   in   that  part   of  the   country.   Now   if 


SINGLE   TAX  179 

any  of  you  care  to  go  up  to  any  of  our  typical  western  cities — 
Vancouver,     Calgary,     Edmonton,     Saskatoon,      Moose    Jaw     or 
even  Winnipeg— what  you  will  find  is  this:  that  the  people  who 
were    there    before    the    land    speculation    started    did    not    raise 
the  values  of  land  there  so   suddenly  as   they  have  been  raised 
within    the    last    six    years.    You    would    find    if    you    went    into 
an  actual  analysis  of  the  situation  that  the  process  was  exactly 
reversed.     People  have  flocked  into  those  cities   because  certain 
men  went  there  and  systematically  organized  land  booms.    The 
Single  Taxers  tell  us  that  men  are  entitled  to  take  what  they  cre- 
ate,  but  they  are  not  entitled  to  take  what  other  people  create. 
Now    a    certain    group    of    land    speculators    have    created    nine- 
tenths    of   the    land    values    out    there,    and    have    sold    them    to 
other    people,    but    what    the    other    people    are    going    to    take 
with  them   in  the  end   remains  to  be  seen.   The   incipient  boom 
that  was  started  off  led  a  great  many  other  people  to   rush   in 
and    that    made    a    demand    for   houses.    They    started    to    build 
houses.   You  make   an   analysis   of  any   of  those   cities   and  you 
will  find  that  the  city  has  grown  up  through  its  own  construc- 
tion because  in  many  of  those  cities  there  is  no  industry;  there 
is  nothing  going  on  except  incidental  industries— sash  and  door 
factories,  brick  making,  etc.— incidental  to  the   construction  and 
building   of   sidewalks,    city   streets   and   all  that.    You   have   an 
army  of  people  brought  in  there  to  do  these  things  and  the  specu- 
lators have  gone  ahead  of  that  and  sold  out.    Now  I  say  the  spec- 
ulator obviously  created  these  values  and  upon  the  principle  of 
a  man  being  entitled  to  what  he  himself  creates  he  is  entitled  to 
all  that  he  got. 

But  here  is  the  other  point:  they  say  that  taxation  will  get 
after  the  speculator— that  the  Single  Tax  will  catch  him.  Go  to 
those  same  cities,  analyize  the  process,  ascertain  who  the  people 
are  who  took  in  hundreds  of  acres,  converted  them  into  city 
lots,  sold  them  within  the  next  twelve  or  eighteen  months  to 
other  people  and  then  went  out  from  there  and  took  in  more 
and  sold  it  again— find  out  whether  the  Single  Tax  got  after 
them.  No,  they  got  in  and  they  got  out,  and  some  of  them  are 
multi-millionaires  today.  They  hardly  paid  a  cent  of  taxes  and 
they  don't  need  to  pay  any  more.  They  have  unloaded  on 
other  people  and  the  people  on  whom  they  first  unloaded  have 
unloaded  on  the  second  comers  and  made  monev. 


i8o  SELECTED   ARTICLES 

This    was   a  common   experience   with   the   type   of  man  who 
had   made    twenty    or   thirty    thousand    dollars,    not    one    of    the 
rich    speculators,    but    a    secondary    speculator.      He    would    talk 
about   having   come    from    down    east,    and    would    say    "At   the 
school  they  all  looked  on  me  as   somewhat  of  a  back  number. 
There  was  Jim  So  and  So  who  always  stood  at  the  head  of  the 
class  and  I  was  way  down ;  but  I  tell  you  when  it  comes  to  the 
real  thing  in  life— that  is  what  puts  it  up  to  you.     Those  fellows 
are  stuck  in  the  mud  down  there  and  I  am  worth  thirty,  forty 
or   fifty  thousand   dollars.     That's   the   real   test    of  intelligence 
and  brains."    "Well,"  I  would  say  to  some  of  these  people,  "yes, 
but  can  you  show  me  any  fool  out  here  who  dipped  in  and  lost?" 
Everything  was  going  up.    It  didn't  matter  what  they  bought;  it 
went  up.     City  lots,  rural   districts— everything  went  up  and  up 
and  up.    But  what  I  want  to  see  is,  when  the  thing  starts   the 
other  way,   who  is   going  to   save  himself.     That   is  the  man  I 
will  take  to  have  the  brains,  and  the  man  with  the  stuff  on  his 
hands  will  be  the  back  number.     He  is  the  man  who  is  going  to 
pay  the  taxes.     I  do  not  take  the  real  speculator  to  be  the  man 
who  buys  now  and  has  to  wait  then,  twenty  or  thirty  years  to 
turn  over.     The  real  speculator  out  there  is  the  man  who  buys 
this  year  and  has  half  of  it  sold  next  year  and  the  other  half 
the  year  after.     You  go  to  those  cities  and  you  will  find   that 
some  of  these  millionaire  speculators  have  gone  away.     Some  of 
them  who  had  money  and  who   invested   it  through  confidential 
agents  took  the  money  and  went  away;  but  a  number  of  others 
joined  the  city  council,  started  in  to  invest  in  sky-scrapers,  big 
office  buildings,  stores,  etc.,  which  were  in  demand,  and  that  is 
where  they  are  now.     And  I  did  not  find  a  single  land  speculator 
out  there  who  was  not  shouting  for  the  Single  Tax.   It  gave  him  a 
halo  of  righteousness,  to  begin  with,  that  he  was  the  man  pay- 
ing the  taxes,— and  he  wasn't,  of  course,— but  it  enabled  him  to 
escape  taxes  on  his  investments  in  the  city. 

Then  there  are  a  dozen  other  things  familiar  enough  in  the 
rapid  development  of  the  real  estate  booms  in  these  cities. 
Every  speculator  is  anxious  to  have  the  real  estate  assessed 
as  high  as  possible  because  it  enables  him  to  borrow  that  much 
more  money  at  fair  rates  in  the  old  country  and  other  places  to 
put  into  local  improvements,  which  give  employment  to  other 
people  to  put  up  these  stores,  shops  etc.     So  long  as  the  foreign 


SINGLE   TAX  i8i 

capital  is  being  brouglit  in,  they  are  booming  their  land  and 
developing  the  cities.  I  say  if  any  of  you  are  curious,  go  out 
and  investigate  yourself.  Don't  write  to  the  mayor  of  the  city, 
or  the  city  clerk  or  the  treasurer  because  you  know  what  you 
will  get,  but  go  and  look  into  it.  Get  these  very  people.  Single 
Taxers  and  so  on,  to  sit  down  half  an  hour  and  go  into  details 
with  them  and  you  will  find  out.  I  have  said  that  in  cities  out 
west — in  Saskatoon  and  Winnipeg — and  I  have  had  a  lot  of 
Single  Taxers  come  to  refute  me,  and  when  I  demonstrated  it, 
they  hadn't  a  word  to  say. 

When  it  comes  to  an  absolutely  solid  basis  all  these  cities 
will  come  to  a  point  at  which  they  will  have  to  worry  along  and 
have  to  get  their  industries  and  learn  over  again,  and  then  and 
then  only  I  would  look  to  them  as  an  example  for  your  older 
cities  and  older  country.  And  I  am  perfectly  confident  from 
what  I  have  seen  and  heard  out  there  that  there  will  be  a  terrible 
sweep  the  other  way,  because  no  man  is  going  to  pay  a  high  price 
for  a  lot  which  he  expects  to  convert  into  a  garden,  with  per- 
haps a  small  house  on  it — not  if  he  is  taxed  up  to  the  limit  and 
all  these  multi-millionaires  go  scot  free  with  their  fine  buildings 
in  the  cities. 

On  this  question  of  land,  I  think  Mr.  Shields  made  it  per- 
fectly clear  that  if  you  take  away  the  rent  value  from  a  piece  of 
property  there  is  nothing  left.  Mr.  Fillebrown  says  you  can  still 
own  the  property.  Of  course,  so  you  can  ...  if  you  still  care 
to.  You  can  put  up  a  fine  building  on  the  property  and  if  the 
state  comes  along  and  takes  away  the  building  rent,  you  can  own 
that  too,  but  to  what  good.  But  Mr.  Fillebrown  may  say  that 
the  land  was  put  there  for  use  and  the  building  was  put  there 
for  use  and  when  a  man  comes  along  and  uses  the  building  to 
sell  goods  in  it  to  keep  offices  in  it,  he  says  he  is  getting  the  value. 
Of  course  he  is.  And  if  the  state  takes  the  rental  of  the  land 
and  the  rental  of  the  building,  the  other  man  can  go  hang. 

Before  following  our  Canadian  example,  wait  and  see  what 
happens. 


i8j  selected   articles 

Equity  Series.  1:185-204.  December,  1898. 

Criticism  of  tlie  Single  Tax.     Newton  AL  Taylor. 

Mr.  Henry  George  in  his  book  entitled  "Progress  and  Pov- 
erty," describes  in  a  most  eloquent  and  powerful  manner  the 
ruinous  effect  on  society  of  the  monopoly  of  the  land  of  a  coun- 
try' by  a  comparatively  small  number  of  its  citizens,  and  as  a 
remedy  he  proposed,  "To  abolish  all  taxation  save  that  upon  land 
values."  I  freely  endorse  all  that  he  has  so  eloquently  said 
concerning  the  evils  of  land  monopoly,  but  I  am  firmly  convinced 
that  he  has  wholly  misconceived  the  true  remedy.  Before  show- 
ing some  of  the  unjust  and  disastrous  effects  that  would  result 
from  the  enforcement  of  this  s\stem  of  taxation,  I  desire  to 
briefly  notice  a  few  of  the  peculiar  catch  \vords  and  phrases  by 
means  of  which  the  Single  Taxers  greatly  deceive  themselves. 

Indictment  A'o.  i.  They  have  a  great  deal  to  say  about 
"land  values,"  and  say  that  they  propose  to  tax  "land  values." 
But  that  is  nothing  new^  for  we  have  always  taxed  land  values. 
We  tax  the  fertile  land  in  our  valleys  from  two  to  ten  times  as 
much  as  we  do  the  land  in  broken,  hilly,  rocky  and  mountainous 
regions,  for  the  simple  reason  that  it  is  worth  more — it  has 
more  value.  For  the  same  reason  we  now  tax  an  eighth  of  an 
acre  of  land  in  a  town  or  city  as  much  as  we  do  a  hundred — or 
two  hundred — or  five  hundred — acres  of  good  land  in  the 
adjoining  country  districts.  We  tax  everything  according  to 
its  value.  We  tax  one  horse  at  forty  dollars  and  another  at 
one  or  two  hundred  dollars  or  even  much  more  than  that, 
because  they  possess  different  amounts  of  value.  We  always 
tax  value — horse  value,  cow  value  and  land  value.  Yet  the 
Single  Taxer  rolls  the  phrase  "land  value"  under  his  tongue  as  a 
sweet  morsel  and  imagines  that  it  is  a  wholly  new  idea.  When 
we  tax  land  we  necessarily  tax  land  value.  To  say  that  there  is 
any  difference  in  taxing  "land"  and  taxing  "land  value"  is 
absurd.  It  is  simply  a  play  on  words.  When  the  Single  Taxer 
proposes  to  throw  all  of  the  burden  of  taxation  upon  "land  value" 
he  simply  means  upon  "land"  alone.  Of  course,  the  w^ord  land 
includes  lots,  mines,  etc. 

Indictment  No.  2.  The  Single  Taxer  talks  a  great  deal  about 
the  "unearned  increment,"  by  which  he  means  the  increase  in  tlie 


SINGLE   TAX  183 

value  or  price  of  land  as  the  demand  for  it  increases  by  the 
increase  in  population.  He  says  that  the  unearned  increment 
should  be  taxed.  But  we  are  now  doing  that,  and  always  have 
done  so.  As  land  increases  in  value  we  increase  the  tax  assess- 
ment on  it.  Farm  lands  and  city  lots  in  the  state  of  IlHnois 
and  city  of  Chicago  are  assessed  at  many  times  as  much  now  as 
they  were  fifty  years  ago.  Then  when  the  Single  Taxer  says  that 
he  proposes  to  tax  unearned  increment  he  means  nothing  new. 
We  have  always  done  that.  It  is  simply  one  of  his  plays  upon 
words. 

Indictment  No.  3.  The  Single  Tax  advocate  greatly  overdraws 
the  fact  of  the  unearned  increm.ent.  There  is  very  little  prairie 
land  in  the  Eastern  and  Southern  states— as  well  as  in  many  of 
the  Western  states.  In  their  natural  condition  they  were  cov- 
ered with  dense  forests  and  almost  impenetrable  growths  of  un- 
derbrush. Large  areas  were  swampy  low  lands,  and  much  of 
the  land  was  covered  with  rocks  and  stones  as  a  legacy  of  the 
glacial  period.  Our  city  Single  Tax  agitators  (and  they  are 
mostly  found  in  cities)  do  not  seem  to  have  the  slightest  idea  of 
the  amount  of  labor  it  took  to  make  beautiful  farms  out  of  those 
heavily  timbered,  rocky  and  ^swampy  lands,  to  say  nothing  of 
the  hardships  and  privations  that  were  endured  by  our  fore- 
fathers. If  we  only  rate  that  labor  at  fifty  cents  a  day  for  each 
day  spent  in  clearing  of  those  forests,  digging  out  the  roots  and 
stumps,  ditching  and  draining  the  swamps  and  gathering  up 
the  rocks  and  stones,  these  lands  would  not  now  sell  for  enough 
to  pay  for  the  work.  As  to  these  vast  areas  there  is  absolutely 
no  unearned  increment.  Yet,  as  we  will  see  further  on,  the 
Single  Taxer  wants  to  throw  much  of  the  burden  of  taxation  on 
these  lands! 

In  our  towns  and  cities  and  in  prairie  countries  there  has 
been  a  large  unearned  increment.  I  say  "has  been''  advisedly, 
because  for  the  most  part  the  unearned  increment  has  been  har- 
vested and  scattered  to  the  four  quarters  of  the  globe,  and  the 
property  is  for  the  most  part  in  the  hands  of  innocent  purchasers. 
As  to  our  farm  lands,  the  unearned  increment  reached  its  high 
water  mark  twenty-five  years  ago  and  since  that  time  they  have 
declined  in  price  nearly  if  not  quite  50  per  cent.  And  the  own- 
ers of  real  estate  in  the  most  of  our  towns  and  cities  have  during 
that  period  suffered  in  the  same  way,  only  the  decrease  has  not 


i84  SELECTED   ARTICLES 

been  so  great.  But  the  process  is  still  going  on  and  it  will 
continue  for  many  years,  because  the  most  of  our  towns  and 
smaller  cities  have  attained  their  normal  size,  and  many  of  them 
have  outgrown  the  country  surrounding  them.  Many  of  them 
are  not  gaining  at  all  in  population  and  in  most  of  them  the 
future  growth  will  be  exceedingly  slow.  Besides  all  this,  town 
and  city  lots  must  go  down  to  the  gold  basis  if  we  maintain  the 
gold  standard.  Farm  lands  and  commodities  have  gone  down 
in  price  to  correspond  with  the  rise  in  gold,  and  town  and  city 
property  must  do  the  same.  Nothing  can  resist  the  fall  of  prices 
consequent  upon  a  rising  monetary  unit.  Everything  must  sooner 
or  later  go  down  to  the  common  level  of  general  prices. 

An  old  citizen  of  Philadelphia  says  that  back  as  far  as  1820 
farm  lands  in  the  vicinity  of  that  city  were  as  high  as  they  are 
now.  And  we  all  know  of  the  hundreds  of  farms  thruout 
New  England  that  have  been  abandoned  in  the  last  twenty-five 
years. 

Therefore  it  is  important  to  remember  that  as  to  a  large  part 
of  our  country  there  is  not  now  and  there  never  has  been  any 
unearned  increment,  and  that  if  there  is  to  be  any  confiscation 
done  it  should  not  apply  to  any  of  these  lands.  And  we  should 
also  remember  that  as  to  those  parts  of  the  country  where  there 
was  any  unearned  increment  as  to  lands  and  lots,  the  most  of 
the  persons  who  got  the  benefit  of  it  are  in  their  graves  and 
that  the  most  of  these  lands  are  now  .owned  by  persons  who  paid 
full  value  for  them,  and  who  in  many  instances  have  already 
lost  money  on  them.  There  has  either  been  no  rise  in  price- 
unearned  increment— or  the  interest  on  the  money  invested  and 
taxes  have  more  than  counter-balanced  it.  It  will  be  very  diffi- 
cult for  the  ordinary  person  to  see  why  the  public  should  con- 
fiscate these  last  named  lands  and  lots.  So  I  respectfully  submit 
that  when  our  Single  Taxers  talk  about  the  unearned  increment 
they  arc  for  the  most  part  talking  about  a  1)ack  number— ancient 
history. 

Indictment  No.  4.  There  is  another  word  about  which  our 
Single  Tax  advocate  has  very  confused  ideas.  I  have  reference  to 
the  word  rent.  It  simply  means  the  consideration  paid  to  the 
owner  of  the  land  for  the  temporary  use  and  occupation  of  the 
land  by  another.  But  the  census  of  1890  showed  that  3,142,746 
of  our  farms  are  occupied  by  the  men  who  own  them,  and  that 


SINGLE   TAX  185 

there  are  only  1,624,433  rented  farms  in  this  country.  The  3,142,- 
746  fanners  pay  no  rent.  And  the  census  reports  show  that 
2,928,671  of  our  homes  in  our  towns,  villages  and  cities  are 
owned  by  the  families  occupying  them,  and  therefore  these  per- 
sons pay  no  rent.  In  heaven's  name  are  the  homes,  farms  and 
residences  of  all  of  these  six  millions  of  families  to  be  confiscated 
simply  to  enable  us  to  punish  the  landlords  of  the  country?  In 
his  inscrutable  reasoning  and  elastic  conscience  the  Single  Taxer 
saj's  yes.  He  has  to  do  so  for  he  makes  no  distinction  between 
the  property  occupied  by  its  owner  and  rented  property. 

The  Single  Taxers  actually  want  the  government  to  forcibly 
appropriate  these  millions  of  homes  and  farms  without  com- 
pensation and  force  all  of  these  people  to  go  to  paying  rent — 
that  is  a  tax  that  is  to  be  equal  to  and  as  burdensome  as  the 
rent  that  is  now  paid  by  our  tenants  to  our  landlords.  They 
want  to  return  to  feudalism  and  change  everybody  into  tenants 
and  make  the  reign  of  rent  universal.  I  protest  against  this 
ruinous  schemic.  Instead  of  destroying  our  millions  of  happy 
homesteads  in  our  villages  and  towns,  cities  and  country  dis- 
tricts, we  should  foster,  protect  and  multiply  them.  Instead  of 
increasing  the  burden  of  taxation  on  them  we  should  relieve 
them  from  taxation,  and  throw  all  of  that  burden  on  our  large 
estates,  on  our  landlords,  and  wealthy  owners  of  both  real  and 
personal  property.  Our  homesteads  are  the  very  last  thing  that 
should  be  taxed. 

But  Mr.  George  in  his  book  says  that  this  theory  will  not 
result  in  the  confiscation  of  land,  but  only  of  the  rent,  and  by 
confiscation  of  rent  he  means  the  imposition  of  an  annual  tax 
that  shall  be  equal  to  the  annual  rental  value  of  the  real  estate. 
Here  is  another  instance  of  that  play  upon  words  in  the  art  of 
which  he  was  a  consummate  master,  and  which  he  handed  down 
to  his  disciples.  Yet  in  the  same  paragraph  he  admits  that  by 
taking  the  "rent"  he  is  taking  the  "kernel"  and  only  leaving 
the  landowner  the  "shell."     (See  Chapter  II.,  Book  8.) 

A  simple  illustration  will  prove  that  it  would  be  the  actual 
confiscation  of  the  real  estate  itself.  Let  us  suppose  that  Mr. 
A.  rents  a  farm  at  a  yearly  rental  of  $300,  which  was  about  6 
per  cent  of  the  value  of  the  property.  He  pays  the  rent  for 
several  years,  and  finally  to  avoid  the  further  payment  of  rent 
he  concludes  to  buy  the  land.     He  manages   to  make  the  first 


i86  SELECTED    ARTICLES 

payment  and  gives  his  note  for  the  balance,  payable  in  install- 
ments and  secured  by  a  mortgage  on  the  land.  He  finally  suc- 
ceeds in  paying  for  the  property.  But  about  that  time  a  Single 
Tax  law  is  passed  and  he  is  at  once  forced  to  pay  a  tax  of  $300 
a  year.  How  much  better  off  is  he  than  he  was  before  he  bought 
the  land.  None  at  all.  He  has  lost  the  money  and  value  he 
paid  for  the  property.  And  he  would  still  be  liable  for  the 
unpaid  purchase  money  notes.  He  could  not  sell  the  property 
because  no  sane  man  would  l)uy  property  upon  which  he  would 
have  to  pay  the  government  a  tax  equal  to  a  full  rental  for  the 
privilege  of  occupying  it.  No  sane  man  would  pay  much  for  the 
mere  "shell." 

In  Chapter  HI.,  Book  9,  Mr.  George  admits  that  the  land 
could  not  be  sold,  and  that  his  scheme  would  result  in  public 
ownership  of  land,  and  he  says  that  the  former  private  land 
owners  should  not  receive  any  compensation  for  this  loss.  But 
he  says  that  the  holders  of  vacant  lands  and  lots  would  be  com- 
pelled to  sell  them.  How  could  they  sell  that  which  has  been 
appropriated  by  the  public?  In  Chapter  I  of  the  same  book  he 
says  that  his  scheme  "would  be  in  effect  putting  up  the  land  at 
auction  to  whoever  would  pay  the  highest  rent  to  the  state."  Is 
not  this  confiscation?  It  is  confiscation  of  both  the  land  in  the 
rural  districts  and  the  lots  in  towns  and  cities. 

Indictment  No.  5.  The  Single  'J'axers  exaggerate  at  least  one 
thousand-fold  the  amount  of  land  and  number  of  lots  that  are 
being  held  out  for  use  for  speculative  purposes,  or  in  other  words 
to  procure  an  unearned  increment.  As  to  our  town  and  city  lots, 
the  taxes  and  interest  on  the  money  invested  in  them  prohibit 
their  being  held  out  of  use  for  any  great  length  of  time.  When 
the  7  to  9  per  cent  of  interest  and  taxes  exceeds  the  annual 
increase  of  the  market  value  of  the  lots,  as  is  the  case  at  present 
in  the  vast  majority  of  our  towns  and  cities,  the  lots  will  be  im- 
proved as  rapidly  as  there  is  any  demand  for  houses.  In  fact, 
the  zeal  of  the  owners  of  lots  to  make  them  bring  in  a  yearly 
income  usually  results  in  an  excess  of  houses.  The  large  sur- 
plus of  unemployed  capital  in  this  country  is  anxiously  seeking 
profitable  investment  in  houses.  That  these  causes  lead  to  a 
supply  far  in  excess  of  the  demand  for  houses  is  demonstrated 
by  the  23,000  vacant  houses  said  to  be  in  Philadelphia  and  the 
vacant  houses  on  every  street  in  Chicago,  and  the  same  condition 


SINGLE   TAX  187 

exists  in  our  towns  and  cities  all  over  the  country.  Then  why 
should  these  lots  be  built  upon?  Vacant  houses  are  not  a  credit 
to  any  town  nor  a  source  of  profit  to  their  owners.  And  cer- 
tainly no  person  wants  to  in  any  way  entice  our  rural  population 
to  move  to  our  towns  and  cities  in  order  to  occupy  these  vacant 
lots.  The  tide  should  be  turned  in  the  other  direction — away 
from  the  cities  to  quiet  country  homesteads.  There  are  too 
many  people  in  our  towns  and  cities  now.  Whenever  there  is  a 
labor  strike  there  are  always,  in  good  times  as  well  as  in  bad 
times,  thousands  of  unemployed  who  are  eager  to  take  the 
places  of  the  strikers.  Houses  and  lots  can  be  rented  at  a  low 
rental  that  hardly  pays  6  per  cent  interest  on  the  investment. 
This  ought  to  be  free  enough  to  suit  the  most  fastidious. 

As  to  our  farm  lands,  the  facts  are  clearly  against  the  claims 
of  the  Single  Taxers.  The  world's  demand  for  grains,  vegetables, 
fruits  and  meats  is  so  great  that  no  man  can  afford  to  deliberately 
hold  good  farming  lands  out  of  use.  If  the  owner  does  not 
desire  to  live  upon  them  and  farm  them  himself,  he  can  rent 
them  to  others  for  a  fair  annual  rental,  and  of  course  he  will 
do  so.  A  man  can  rent  his  land  out  for  what  it  will  bring  and 
still  hold  it  for  an  increase  in  price  so  he  may  be  able  to  sell  at 
a  profit.  Wh}'  should  he  not  do  so?  Will  a  duck  swim?  The 
simple  fact  is  that  land  owners  do  not  to  any  material  extent 
withhold  their  land  from  use.  They  have  to  pay  taxes  on  it 
every  year  and  it  is  but  natural  that  they  should  make  it  yield 
enough  to  pay  the  taxes  and  also  pay  as  much  as  possible  on 
the  money  invested  in  it.  And  especially  is  this  true  at  a  time 
when  the  price  of  the  land  is  declining,  as  it  has  been  in  this 
country-  for  the  last  twenty-five  years.  Their  lands  are  being 
used  either  for  cropping  or  grazing  purposes.  Surely  no  one 
wants  any  more  of  our  forests  cut  down,  in  order  to  increase 
the  area  of  cultivable  land.  Too  many  of  our  forests  have  been 
cut  down  already  by  our  citizens  in  their  greed  and  zeal  to  put 
land  into  use  and  make  it  yield  a  profit.  The  amount  of  farm- 
ing land  and  the  number  of  lots  that  are  being  held  out  of  use 
is  very  small  indeed,  and  yet  for  the  purpose  of  forcing  these 
lands  and  lots  into  use  before  there  is  any  active  demand  for 
them,  the  Single  Taxer  would  destroy  five  or  six  millions  of 
homesteads  and  compel  them  to  be  yearly  let  "out  to  the  highest 
bidders  in  lots  to  suit,"'  as  Mr.  George  expresses  it  in  his  book. 


i88  SELECTED   ARTICLES 

What  a  queer  old  world  we  live  in  any  way!  Truly  it  takes  all 
kinds  of  men  to  make  a  world. 

Indictment  No.  6.  What  would  become  of  the  three  or  four 
billions  of  mortgage  debts  that  now  are  secured  by  these  home- 
steads? Is  repudiation  to  be  added  to  confiscation?  It  would 
seem  so. 

But  let  us  analyze  this  mortgage  question,  for  our  Single 
Taxer  who  never  stops  to  analyze  anything  and  who  has  no  use 
for  the  facts  and  figures  shown  by  the  government  census  re- 
ports. We  will  see  that  not  only  would  our  mortgage  debtors  be 
ruined,  but  that  many  of  our  mortgage  creditors  would  be  also. 
The  total  amount  of  our  mortgage  debts  in  1890  was  $6,019,- 
679,985.  This  was  an  increase  of  $2,404,839,985  since  1888,  and 
these  mortgage  debts  now  probably  amount  to  ten  billions  of 
dollars.  These  mortgages  are  secured  by  both  the  real  estate 
and  the  improvements  thereon.  Now  let  us  suppose  that  the 
public  through  the  Single  Tax  system,  has  appropriated  the  land. 
This  throws  the  entire  mortgage  debt  on  the  improvements  and 
such  personal  property  as  the  debtor  may  have  subject  to  execu- 
tion. Of  course,  the  debtor  will  not  be  able  to  pay  the  debt 
after  the  real  ownership  of  land  has  been  taken  from  him,  and 
he  will  have  to  pay  interest  on  the  debt  and  also  a  full  rental  on 
the  land,  if  he  chooses  to  remain  on  it.  As  we  shall  see  further 
on,  this  rental  would  absorb  all  the  profits  he  could  make  out  of 
the  land  by  tilling  it,  and  he  could  not  pay  the  annual  interest 
on  the  debt — much  less  the  principal.  The  result  would  be  that 
the  mortgage  would  be  foreclosed  on  the  improvements.  This  is 
a  most  serious  matter,  because  in  1890,  273,352,109  acres  of  our 
improved  farms  were  under  mortgage  and  thousands  of  homes 
in  towns  and  cities  were  also  encumbered. 

I  leave  for  the  Single  Taxers  to  say  what  the  improvements 
would  sell  for  without  the  land.  They  have  never  been  able  to 
agree  among  themselves  what  will  be  the  status  of  the  improve- 
ments on  real  estate  under  their  system.  We  know  that  in  most 
instances  they,  would  not  sell  for  half  enough  to  satisfy  the 
mortgage  debt,  interest  and  costs  of  rent.  The  balance  of  the 
judgment  would  be  levied  on  such  personal  property  as  the 
debtor  might  have  and  he  would  be  turned  out  of  house  and 
home  a  pauper.  In  ninety-nine  cases  out  of  one  hundred  the 
personal  property  of  the  debtor  would   not   sell   for  enough   to 


SINGLE   TAX  189 

pay  the  deficit  and  the  creditor  would  lose  the  greater  part  of 
his  debt,  for  in  most  instances  mortgage  farm  loans  are  made 
principally  on  the  value  of  the  real  estate  irrespective  of  the 
improvements.  It  must  be  clear  to  all  that  the  uncompensated 
appropriation  of  the  land  of  the  nation  by  the  general  public 
would  result  in  ruin  to  our  mortgage  debtors  and  repudiation  and 
ruin  to  many  of  our  mortgage  creditors. 

Indictment  No.  7.  But  this  is  not  all  of  the  case  against 
the  Single  Tax  by  a  great  deal.  There  is  probably  more  money 
loaned  out  on  personal  security — on  notes  with  sureties — than 
there  is  on  mortgage  security.  In  reckoning  the  solvency  of  the 
makers  of  these  notes  and  their  sureties  the  creditor  looks  prin- 
cipally to  the  amount  of  the  unincumbered  real  estate  they  own. 
If  the  government  by  the  Single  Tax  appropriates  all  of  this  land 
it  so  far  destroys  the  security  of  those  notes  and  also  so  far 
destroys  the  ability  of  the  debtors  to  pay  the  notes.  Hence  suits 
will  be  brought  on  the  notes,  the  debtors  will  be  stripped  of  their 
improvements  and  personal  property  and  even  then  the  creditors 
will  probably  lose  a  part  of  their  claims.  When  we  consider 
the  fact  that  the  last  census  report  shows  that  the  people  of  this 
country  owed  over  twenty  billions  of  dollars  on  those  classes 
of  debts  that  could  be  readily  ascertained  and  tabulated  by  our 
census  takers,  and  that  the  other  debts  amounted  to  nearly  as 
much  more,  we  can  form  some  faint  conception  of  the  disastrous 
and  far-reaching  effects  of  the  adoption  of  the  Single  Tax 
system.  Is  it  -not  perfectly  plain  that  it  would  result  in  the 
creditors  absorbing  the  greater  part  of  the  personal  property  of 
the  nation  and  also  the  greater  part  of  the  improvements  on  our 
real  estate,  and  all  this  property  they  would  hold  free  from  tax- 
ation? Yet  the  Single  Taxers  pose  as  the  friends  of  the  common 
people ! 

As  we  have  seen,  after  exhausting  the  improvements  and  per- 
sonal property  of  the  debtors,  in  most  cases  the  debt  would 
still  be  unpaid  and  there  would  be  a  loss  to  the  creditor.  The 
rich  creditor  could  stand  this  loss,  as  he  would  have  plenty  left 
to  satisfy  not  only  his  necessities  but  every  conceivable  luxury. 
But  not  so  with  the  poor  creditors  who  have  their  savings  or 
small  patrimony  loaned  out.  This  loss  would  ])e  heavy  and 
ruinous  to  them.  The  deposits  in  our  savings  banks  amount  to 
^2,065,631,298.     They  are  mostly  loaned  on   real    estate   security. 


ipo  SELECTED    ARTICLES 

The  Single  Tax  would  ruin  every  savings  bank  in  the  country 
and  their  depositors  would  lose  their  savings.  ,  Our  people  have 
deposited  in  our  national  banks  $2,106,600,000,  and  also  fully  as 
much  more  in  our  private  banks,  trust  companies,  building  and 
loan  associations,  etc.  Much  of  this  money  is  loaned  out  either 
directly  or  indirectly  on  real  estate  security.  It  is  certain  that 
these  depositors  would  lose  enormously  by  the  appropriation  by 
the  government  of  the  lands  and  securing  these  loans. 

Therefore  it  is  perfectly  clear  that  the  Single  Tax  would  rob 
over  six  millions  of  our  citizens  of  their  homes  and  personal 
property,  and  rob  the  poorer  class  of  our  creditors  of  their  sav- 
ings, and  bankrupt  tens  of  thousands  of  our  business  men  and 
produce  the  worst  panic  ever  known  in  the  history  of  the  world. 
And  yet  Afr.  George  says  in  Chapter  IV.  of  Book  9  that  "this 
measure  would  make  no  one  poorer  but  such  as  could  be  made 
a  great  deal  poorer  without  being  really  hurt,"  and  that  "it  would 
impoverish  no  one."  And  his  followers  try  to  believe  it.  But 
they  dare  not  attempt  to  enter  upon  any  proof  in  regard  to  the 
matter.  The  facts  are  against  them.  It  should  also  be  remem- 
bered that  our  business  men  are  heavy  creditors  and  a  loss  of  a 
material  portion  of  their  bills  receivable  would  bankrupt  them. 
Vet  this  would  be  the  inevitable  result  if  the  debtors  of  business 
men  were  to  be  robbed  of  their  lands  and  lots  and  they  would 
all  have  to  go  to  paying  rent.  They  would  not  be  able  to  pay 
their  debts  to  business  men.  Surely  our  Single  Tax  friends 
"know  what  they  do." 

Indictment  No.  8.  But  let  us  go  a  little  deeper  into  this 
question.  It  will  be  necessary  to  make  a  few  calculations.  In 
his  fine  flights  of  oratory  Mr.  George  did  not  stop  to  bother 
with  figures,  and  his  disciples  have  inherited  his  weakness  in  the 
science  of  mathematics.  The  reports  of  the  census  and  statistical 
departments  of  our  government  have  no  charm  for  them.  We 
will  therefore  have  to  do  the  calculating  for  them. 

Their  proposition  is  to  throw  all  taxes  on  land  alone.  And 
when  the  Single  Taxer  uses  the  word  "all"  he  means  just  what 
he  says.  Therefore  Henry  George  was  a  free  trader,  and  in 
Chapter  III  of  Book  9  of  "Progress  and  Poverty"  he  makes  a 
strong  argument  against  tariff  duties;  and  of  course  he  was 
opposed  to  our  internal  revenue  laws  because  tobaccos  and  liquors 
are  personal  property.    And  his  followers  are  free  traders  almost 


SINGLE   TAX  191 

to  a  man.  Then  let  us  see  how  much  of  a  burden  this  theory 
of  taxation  would  throw  on  land  alone. 

Let  us  first  see  what  would  be  the  annual  tax  rate  or  rental 
under  this  system  for  state  and  local  governments  alone  without 
interfering  with  our  present  tariff  and  internal  revenue  laws. 

The  total  property  assessed  for  taxation  in  this  country  in 
1890  was  as  follows: 

Real  estate  and  improvements $18,956,556,675 

Personal  property   6,516,616,743 

Total $25,473,173,418 

The  total  taxes  collected  on  this  property  in  1890  by  state  and 
local  governments  amounted  to  $470,651,927.  This  makes  the 
average  tax  rate  a  very  small  fraction  less  than  2  per  cent.  It 
will  be  noticed  that  the  land  and  improvements  are  given  to- 
gether. Therefore  we  must  next  get  at  the  probable  value  of 
the  land  alone.  In  the  state  of  Massachusetts  the  land  and  the 
improvements  are  assessed  separately,  and  in  1880  the  land  and 
lots  of  the  state  were  assessed  at  $587,824,672,  while  the  im- 
provements were  assessed  at  $752,669,001.  The  improvements 
amounted  to  56  per  cent  and  the  lands  and  lots  44  per  cent.  In 
states  having  large  cities  like  Chicago,  New  York  or  Philadel- 
phia the  per  cent  of  improvements  would  be  considerably 
larger,  while  in  some  of  the  sparsely  settled  Western  states  the 
value  of  the  lands  would  exceed  that  of  the  improvements.  In 
England  the  improvements  are  valued  at  £2,280,000,000,  while  the 
lands  and  lots  are  only  valued  at  £1,880,000,000.  Therefore  it 
would  seem  that  taking  our  country  over  the  value  of  the  lands 
and  of  the  improvements  are  about  equal.  And  this  was  the 
estimate  of  the  census  department  in  1880,  showing  that  at  that 
time  the  real  estate  of  the  country  was  assessed  at  $6,592,000,000, 
while  the  improvements  were  assessed  at  $6,437,000,000.  By 
counting  them  of  equal  value  in  1890  this  gives  us  the  assessed 
value  of  the  land  alone  at  $9,478,278,337.  Throwing  upon  this 
land  the  total  expenses  of  the  state  and  local  governments  for 
that  year — $470,651,927 — would  give  us  an  average  tax  rate  of 
about  5  per  cent.  That  is  to  say,  that  the  farmer  who  owns  a 
farm  of  100  acres  worth  $50  per  acre  without  improvements 
would  have  to  pay  taxes  to  the  amount  of  $250  per  year  on  his 
$5,000  worth  of  land.     Under  our  present  system,  if  we  count 


192  SELECTED   ARTICLES 

his  buildings  and  personal  property  at  $2,000  (which  is  a  liberal 
estimate  for  the  average  farm)  his  taxes  would  only  amount  to 
2  per  cent  on  $7,000 — $140.  But  as  a  rule  the  citizens  in  towns 
and  cities  have  more  value  in  their  improvements  and  personal 
property  than  they  have  in  their  lots. 

Let  us  take  the  typical  shoe  or  dry  goods  merchant  in  the 
ordinary  county  seat  of  from  three  to  ten  thousand  inhabitants, 
who  owns  his  home  and  w^iose  combined  property  is  assessed  at 
$7,000,  the  same  as  our  farmer  above  mentioned.  Under  our 
present  system  of  taxing  all  wealth  alike,  his  taxable  wealth  would 
be  something  like  this  : 

Residence  lot $1,000.00 

House,  barn,  fences,  etc 2,000.00 

Furniture,  carpets,  piano,  etc 500.00 

Stock  of  goods  in  store 3,500.00 

Total $7,000.00 

Under  our  present  system  wath  an  average  tax  rate  of  about 
two  per  cent,  his  taxes  will  be  $140.  But  under  the  Single  Tax 
five  per  cent  rate  on  the  lot  alone  his  tax  would  only  be  $50, 
while  under  the  same  system  the  farmer  of  the  same  w^ealth 
w^ould  have  to  pay  $250  on  his  land.  Is  not  this  an  unjust  dis- 
crimination against  the  farmer  and  in  favor  of  the  merchant? 
But  let  us  consider  the  thousands  of  men  in  towns  and  cities 
who  have  an  abundance  of  personal  property  and  no  real  estate. 
They  would  escape  taxation  entirely  under  the  Single  Tax,  Take 
the  store  keeper  who  has  say  $7,000  worth  of  goods  in  his  store, 
and  furniture  in  his  house,  etc.,  or  take  the  money  lender  who  has 
$7,000  loaned  out  on  interest.  Is  it  right  to  relieve  them  from 
taxation  entirely  and  make  the  farmer  owning  a  like  amount 
of  property  pay  an  annual  tax  of  $250?  That  is  precisely  what 
the  Single  Taxer  proposes  to  do !  The  stores,  the  factories,  the 
hotels  and  office  buildings  and  the  notes,  etc.,  are  means  of  pro- 
duction, and  why  should  not  they  be  taxed  the  same  as  the 
farmer's  means  of  production?  The  land  is  the  farmer's  means 
of  production  and  it  is  absolutely  criminal  to  relieve  the  means 
of  production  of  all  other  classes  of  citizens  from  taxation  and 
thereby  greatly  increase  the  burden  of  taxation  on  the  farmer's 
means  of  production.  And  when  we  remember  that  under  the 
single  land  tax,  the  wealthy  owners  of  the  biUions  worth  of 
property  in  the  form  of  stores,  factories,  money,  notes,  mortgages, 


SINGLE  TAX  193 

stocks,  bonds,  street  cars,  railroad  cars  and  engines,  etc.,  would 
escape  taxation,  the  enormity  of  the  proposition  is  more  apparent. 
These  things  are  all  means  of  production  and  they  are  piHng  up 
millions  of  wealth  for  their  owners  every  year,  and  they  should 
not  be  relieved  of  taxes  and  the  additional  burden  thrown  upon 
the  farmers'  means  of  production.  From  the  land  the  farmers 
produce  the  food  we  cat  and  the  raw  materials  for  the  clothing 
we  wear.  Why  should  all  the  burden  of  taxation  be  thrown 
upon  our  primary  means  of  production?  The  taxes  must  be 
raised  and  it  is  an  undeniable  proposition  that  if  we  relieve  one 
class  of  citizens  from  taxation  the  taxes  of  the  other  classes  will 
be  increased.  If  we  relieve  all  personal  property  and  improve- 
ments from  taxation  we  thereby  of  necessity  increase  the  tax 
on  land.    Surely  no  man  can  be  found  to  deny  these  propositions. 

That  we  have  a  large  class  of  extremely  wealthy  citizens  in 
this  country  (mostly  in  cities)  wh'o  own  hundreds  of  millions 
of  dollars  worth  of  personal  property  and  very  little  or  no  real 
estate,  is  true.  Twenty  millions  of  our  citizens  Hve  in  our  448 
cities  of  ten  thousand  inhabitants  and  over.  These  people  own 
nine-tenths  of  the  personal  property  and  improvements  of  the 
nation.  Why  should  they  be-relieved  from  taxation?  The  con- 
clusion cannot  be  avoided  that  if  we  relieve  them  from  taxation, 
the  owners  of  the  land  and  lots  must  bear  the  additional  burden, 
and  that  their  taxes  will  be  increased  and  they  as  a  rule  are  least 
able  to  bear  it. 

Let  us  take  a  much  older  country  than  ours  for  an  illustration. 
In  Belgium  in  1872  the  total  amount  of  taxes  raised  was 
213,352,689  francs.  Of  this  amount  only  20,258,083  francs  were 
raised  on  land  and  improvements,  and  only  13,230,057  francs  on 
personal  property.  The  remainder  was  raised  by  means  of 
trade  licenses,  stamp  duties,  custom  and  excise  duties,  income 
and  inheritance  taxes,  etc.  Is  it  not  clear  that  if  all  this  tax 
should  be  put  upon  the  land  alone  the  burden  would  be  enormous 
and  utterly  unbearable?  Of  course  in  a  new  and  thinly  settled 
country  where  there  are  but  few  valuable  improvements  and 
where  there  is  but  little  personal  property,  and  where  the  public 
expenses  are  light  and  they  are  already  of  necessity  mostly 
raised  on  real  estate,  the  adoption  of  the  Single  Tax  would  not 
throw  much  extra  burden  on  real  estate.  This  has  been  proven 
in   some   of  the    new    countries   in   Australia,    where   the    Singly 


194  SELECTED   ARTICLES 

Tax  has  been  adopted  in  a  modified  form.  But  conditions  are 
altogether  different  in  older  countries  where  the  public  expenses 
are  heavy  and  are  mostly  raised  on  things  other  than  real  estate. 
The  state  of  Pennsylvania  levies  no  tax  for  state  purposes  on 
real  estate  at  all,  but  only  on  personalty,  corporations,  inheri- 
tance, etc. 

But  let  us  consider  the  question  solely  as  to  the  owners  of 
real  estate  and  improvements.  Here  again  we  must  simply 
open  our  eyes  to  the  facts  and  see  that  there  are  classes  of  real 
estate  owners  whose  per  cent  of  improvements  on  their  real 
estate  is  much  larger  than  is  that  of  other  classes  of  real  estate 
owners.  By  the  exemption  of  improvements  from  taxation  the 
former  would  be  greatly  benefitted  at  the  expense  of  the  latter. 
That  this  would  again  be  a  discrimination  in  favor  of  the  rich 
and  against  the  poorer  and  middle  classes  is  evident,  because  it 
is  the  rich  only  that  can  own  palatial  residences,  ten  and  twenty 
story  hotels  and  office  buildings,  and  enormous  store  buildings 
and  factories  covering  whole  squares.  Their  excess  of  improve- 
ments over  land  is  very  large. 

Who  are  the  poorer  classes  of  real  estate  owners  who  would 
be  hurt  by  this  system?  Let  us  first  look  to  our  towns  and  cities 
The  vast  majority  of  our  town  and  city  lots  are  occupied  for 
residence  purposes.  The  lots  in  any  one  portion  of  our  towns 
and  smaller  cities  are  of  about  the  same  value.  Yet  the  improve- 
ments upon  them  generally  differ  very  widely  in  extent  and 
value.  One  lot  owned  by  a  rich  man  may  have  on  it  a  house 
worth  ten,  twenty  or  fifty  thousand  dollars,  and  which  would  be 
filled  with  fine  furniture,  carpets,  tapestry,  paintings  and  musical 
instruments  of  the  value  of  many  thousands  of  dollars,  while 
another  lot  in  the  same  square  and  on  the  same  street  and  of 
the  same  market  value,  but  belonging  to  a  poor  man,  may  have 
on  it  a  residence  worth  only  a  thousand  dollars,  and  have  in  it 
furniture,  etc.,  not  to  exceed  $500  in  value.  Is  it  not  as  clear 
as  the  open  light  of  day  that  if  we  relieve  the  improvements  and 
personal  property  of  the  former  from  all  taxation  we  are  favor- 
ing the  rich  man  much  more  than  the  poor  man?  And  it  must 
be  plain  that  the  taxes  now  paid  by  the  rich  man  on  his  fine 
house  and  contents  or  his  hotel,  business  block  or  factory,  will 
not  be  shifted  to  his  lot  alone,  but  that  a  great  part  will  be 
shifted  to  the  lots  of  his  poorer  neighbors,  and  also  to  the  small 


SINGLE   TAX  195 

farmers  whose  lands  are  worth  more  than  their  improvements 
and  personal  property. 

In  a  town  or  city  there  will  be  a  thousand  houses  on  100  acres 
of  land,  while  in  the  country  there  will  only  be  one  house  on 
that  amount  of  land.  If  we  relieve  the  1,000  town  houses  from 
taxation  a  large  part  of  that  burden  will  of  necessity  fall  upon  the 
farms  where  the  per  cent  of  improvements  to  a  given  amount  of 
land  is  small. 

But  let  us  for  a  moment  consider  the  question  solely  from  the 
farm  owners'  standpoint,  as  among  themselves.  The  first  fact 
to  observe  is  that  they  too  are  divided  into  the  rich  and  the 
poor,  as  determined  by  the  amount  of  land  they  own.  The  last 
census  shows  that  the  farms  of  100  acres  and  under  in  size  were 
2,440,006  in  number,  covering  an  area  of  122,000,300  acres,  and 
their  owners  may  be  considered  as  the  poorer  class  of  farm  own- 
ers. There  were  also  at  that  date  3,246,128  farms  of  over  100 
acres  in  extent,  covering  an  area  of  973,836,000  acres,  and  their 
owners  may  justly  be  classed  among  the  rich  class  of  land 
owners.  Now,  the  question  is,  which  class  has  the  greater  per 
cent  of  improvements  and  personal  property  as  compared  with 
the  value  of  the  land  alone.  When  this  is  determined  we  can 
then  easily  tell  which  class  is  benefitted  and  which  class  is 
injured  by  exempting  personalty  and  improvements  from  taxa- 
tion and  throwing  the  whole  burden  of  taxes  on  land  alone. 

Those  who  have  any  knowledge  of  farmers  and  farm  life 
know  that  it  is  on  the  large  farms  that  we  find  the  fine  residences 
and  large  barns,  and  also  the  latest  and  costliest  farming  imple- 
ments and  machinery,  and  .also  the  large  flocks  of  sheep,  droves 
of  horses  and  hogs,  and  herds  of  cattle,  running  up  in  value 
to  tens  or  even  hundreds  of  thousands  of  dollars  in  value.  The 
small  farmer  lives  in  a  cottage,  and  as  he  is  forced  to  make  the 
most  out  of  his  land  he  cultivates  the  most  of  it  and  sells  the 
grain  and  vegetables.  This  leaves  him  but  little  land  for  grazing 
purposes,  and  therefore  he  cannot  have  much  live  stock  about 
him.  He  must  be  content  with  a  milk  cow  or  two,  a  team  of 
horses  and  a  few  pigs.  And  he  cannot  afford  expensive  imple- 
ments and  machinery.  He  does  his  work  in  the  old  methods 
as  far  as  possible.  Therefore,  it  must  be  clear  that  the  owners 
of  large  farms  will  be  benefitted  by  the  Single  Tax,  and  that 
the  owners  of  small  farms  will  be  damaged  by  it.     In  the  last 


196  SELECTED   ARTICLES 

analysis  of  the  whole  matter  it  is  evident  that  the  general 
effect  of  the  whole  scheme  will  be  favorable  to  all  classes  of  rich 
people  and  unfavorable  to  the  holders  of  small  farms  and  the 
poorer  classes  of  lot  owners  in  our  towns  and  cities,  and  that 
the  greater  part  of  the  taxes  now  paid  by  the  rich  will  be  shifted 
on  the  classes  last  named.  The  little  that  the  latter  would 
gain  by  relieving  their  personal  property  and  improvements 
would  be  small  indeed  as  compared  with  the  increase  in  the  taxes 
on  their  lands  and  lots.  The  fact  is  that  in  many  of  our  states 
they  are  now  relieved  of  taxation  on  much  of  their  personal 
property.  In  these  states  the  Single  Tax  would  bear  heaviest 
on  them.  And  yet  these  are  the  very  classes  that  most  need 
assistance  and  encouragement.  Instead  of  increasing  the  taxes 
on  them  we  ought  to  exempt  them  from  taxation  altogether. 
We  cannot  have  too  many  small  homesteads  in  town,  city  and 
country.  We  ought  to  so  legislate  as  to  multiply  them  a  thou- 
sand-fold; and  we  can  do  so  if  we  only  will.  The  experience 
of  other  nations  as  well  as  our  own  points  to  an  easy  and  certain 
way.  There  is  no  need  of  trying  any  wild  experiments.  The 
farms  in  France  only  average  I2j/^  acres  in  size.  Every  one 
of  them  supports  a  family.  We  need  to  so  legislate  as  to  sub- 
divide our  land  into  small  family,  homesteads  that  shall  be  cher- 
ished and  loved  and  handed  down  in  the  same  family  for 
generations. 

But  let  us  consider  the  effect  of  a  five  per  cent  tax  on  our 
six  millions  of  home  owners  in  town,  city  and  country.  This 
is  about  what  Mr.  George  thought  the  tax  would  be,  for  in 
Chapter  19,  Book  IX,  he  says  tliat  his  system  would  "very 
nearly  consume  the  value  of  the  land,"  and  five  per  cent  is 
about  the  average  per  cent  of  profit  on  the  money  invested  in 
real  estate.  So  far  as  people  in  towns  and  cities  are  concerned 
the  five  per  cent  on  the  value  of  their  lots  only  would  not  be 
oppressive  because  they  own  so  much  in  improvements  and 
personal  property  which  would  be  exempted  from  taxation. 
Taking  our  merchant  who  owns  $6,000  in  improvements  and 
personal  property  and  only  $1,000  worth  of  land  as  an  example, 
if  he  is  exempted  from  all  tax  on  the  $6,000,  he  can  afford  to 
pay  fifty  dollars  a  year  tax  on  his  $1,000  lot,  as  that  would  be 
much  less  than  he  now  pays  on  all  of  his  property.  But  the 
burden  that  is  shifted  from  him  must  fall  upon  somebody  else. 


SINGLE  TAX  197 

As  we  have  seen  it  would  fall  mostly  upon  the  owners  of  small 
farms  and  homes  in  towns  and  cities  who  have  but  Httle  per- 
sonal property  and  whose  farms  and  lots  are  worth  more  than 
the  improvements  upon  them,  as  is  so  frequently  the  case.  If  a 
mechanic  owns  a  lot  worth  $1,000  and  a  cottage  on  it  worth 
$800,  the  five  per  cent  on  his  lot  would  amount  to  considerably 
more  than  his  taxes  under  our  present  system.  But  still  he 
might  be  able  to  pay  it  if  he  does  not  get  sick  or  lose  his 
employment. 

But  how  will  it  be  with  the  farmer  whose  tax  has  been  raised 
from  $140  to  $250  on  one  hundred  acres  of  land?  Those  who 
know  anything  about  the  profits  of  small  farms  for  the  last 
25  years  know  that  such  a  large  additional  burden  as  that  would 
be  absolutely  unbearable.  Their  very  narrow  margin  of  profits 
was  clearly  shown  by  the  elaborate  investigation  of  the  matter 
by  the  Labor  Commissioner  of  Connecticut  in  1888.  The  ac- 
counts covered  693  farms  of  that  state  averaging  no  acres 
each,  and  showing  a  total  capital  employed  of  $3,810,742.  The 
total  receipts,  including  products  consumed  by  family,  were 
$707>i53,  and  the  total  expenditures,  including  products  consumed 
in  family  support,  but  not  counting  labor  done  by  the  owner 
and  his  family,  were  $680,990,  thus  showing  a  net  profit  of  only 
$16,163.  It  is  safe  to  say  that  the  farms  of  Connecticut  could 
not  stand  a  tax  of  five  per  cent  on  their  farm  land.  And  what 
is  true  of  them  is  true  of  a  majority  of  small  farmers  all  over 
the  country.  Many  of  them  have  not  been  able  to  make  ends 
meet,  and  have  been  forced  to  mortgage  their  farms  in  the  last 
few  years,  and  many  have  lost  their  farms  entirely. 

And  here  is  another  very  serious  matter  that  must  be  con- 
sidered. The  census  of  1890  showed  that  886,957  of  our  im- 
proved farms,  aggregating  273,352,109  acres,  were  encumbered 
by  mortgages.  Then  we  must  squarely  face  the  question  as  to 
whether  or  not  the  owners  of  these  encumbered  farms  could  pay 
their  mortgage  debts  and  the  increased  taxes?  The  above 
statistics  from  Connecticut  and  the  experience  of  small  farmers 
all  over  the  country  unite  in  saying  that  they  could  not.  The 
mortgages  would  be  foreclosed  by  the  wholesale  and  the  creditors 
would  get  the  improvements  and  possession  of  the  farms  and 
the  debtors  would  be  turned  adrift.  It  is  safe  to  say  that  the 
farmers   of  the  country  will  never   favor  the   Single   Tax,   and 


198  SELECTED   ARTICLES 

that  they  will  have  a  very  poor  opinion  of  those  persons  who 
are  trying  to  take  their  farms  from  them  in  this  way. 

Indictment  No.  9.— But  the  half  has  not  yet  been  told  in 
regard  to  the  deadly  effects  of  the  Single  Tax.  We  have  seen 
that  if  the  expenses  of  our  state  and  local  governments  were 
thrown  upon  land  alone,  the  tax  rate  would  be  five  per  cent. 
But  in  addition  to  this  the  Single  Taxers  propose  to  abolish 
our  tariff  and  internal  revenue  laws  and  throw  upon  our  land 
the  enormous  expenses  of  our  general  government ! !  Now  of 
course  they  have  never  calculated  the  effects  of  this.  The  gov- 
ernment statistical  and  census  reports  have  been  open  to  them. 
They  have  even  been  published  in  pamphlet  form  for  free  dis- 
tribution by  the  government.  And  abstracts  of  them  have  been 
published  in  cheap  form  in  our  newspaper  almanacs.  But  our 
friends  do  not  want  to  be  bothered  with  facts.  Their  minds  are 
too  full  of  theories.  I  have  already  quoted  freely  from  those 
reports  and  I  will  be  obliged  to  do  so  once  more  to  find  out 
what  this  additional  burden  will  be. 

In  determining  this  question  I  have  thought  best  to  take  the 
expenses  of  the  government  for  1896,  as  that  was  before  our  very 
honorable  war  with  Spain  was  begun,  and  also  before  our  very 
dishonorable  war  with  the  Philippines  was  begun,  and  the  ex- 
penses for  that  year  were  about  normal.  The  reports  of  the 
Secretar>-  of  the  Treasury  show  that  the  expenses  of  the  gov- 
ernment for  1896  amounted  to  $748,369,469-  ^f  to  this  we  add 
the  $470,651,927  annual  expenses  of  our  state  and  local  govern- 
ments we  have  a  total  annual  tax  of  $1,219,021,396  that  our 
Single  Tax  friends  propose  to  saddle  on  our  land  and  lots  every 
year.  As  we  have  seen  the  land  and  lots  are  now  assessed  at 
$9,478,278,337.  This  would  give  us  an  annual  tax  rate  on  our 
real  estate  alone  of  nearly  13  per  cent!!  Still  carrying  the 
illustration  of  the  mechanic  in  the  city  who  owns  a  lot  worth 
$1,000  and  the  farmer  who  has  a  farm  worth  $5,000,  this  would 
make  the  annual  tax  of  the  mechanic  $130  and  of  the  farmer 
$650.  And  yet  we  are  gravely  told  that  the  Single  Tax  would 
give  us  "free  land."  The  mechanic  might  possibly  stand  this, 
but  it  is  absolutely  certain  that  the  farmer  could  not.  He  could 
not  protect  himself  by  raising  the  prices  of  his  farm  products 
because  under  free  trade  any  material  increase  here  of  the  price 
over  the  average  world  price,  would  bring  farm  products  to  us 


SINGLE  TAX  199 

from  all  over  the  world.  And  even  if  the  farmer  could  raise 
the  price  of  his  products  to  correspond  to  the  increased  taxes 
on  his  land,  this  would  be  shifting  the  tax  to  the  consumers  in 
our  towns  and  cities  and  the  objects  of  the  city  Single  Taxers 
would  be  defeated.  They  do  not  want  to  pay  any  tax  either 
directly  or  indirectly. 

Other  points  might  be  made  against  the  Single  Tax,  but  I 
have  already  exceeded  the  space  allowed  for  this  article.  I 
think  the  nine  indictments  with  the  facts  and  statements  given 
are  sufficient  to  demonstrate  the  utter  folly  and  injustice  of  the 
system. 

There  are  plenty  of  ways  of  preventing  land  monopoly  that 
would  not  have  the  unjust,  demoralizing  and  disastrous  effects 
of  the  Single  Tax.  Progressive  taxation  would  be  a  good  remedy 
with  no  disastrous  effects.  The  same  is  true  of  a  system  of 
graduated  income  and  inheritance  taxation.  A  system  em- 
bracing the  exemption  of  homesteads  from  taxation,  heavy  stamp 
duties  on  sales  of  real  estate  not  to  be  used  as  homesteads,  the 
exemption  of  homesteads  from  mortgages,  and  the  establish- 
ment of  government  agricultural  villages  for  the  very  poor, 
would  be  a  more  complete  remedy,  with  no  bad  effects  whatever. 
And  to  these  could  be  added  the  income  and  inheritance  tax. 
There  is  no  possible  excuse  for  so  visionary,  revolutionary  and 
disastrous  a  scheme  as  the  Single  Tax. 


SUPPLEMENTARY  MATERIAL  FOR 
SECOND  EDITION 

Plain  Talk  on  Single  Tax 
James  R.  Brown 

It  breaks  my  heart,  when  leaving  a  single  tax  meeting,  to 
hear  somebod}'  coming  out  say :  "Well !  I  listened  to  those 
speeches,  but  I  don't  know  any  more  about  the  single  tax  now 
than  when  I  went  in" ;  and  I  am  aware  that  people  of  ordinary 
good  sense  sometimes  have  that  experience.  Now,  the  single  tax 
is  not  had  to  understand,  and  I  am  sure  I  can  prove  that  to  you 
if  you  will  listen  to  me  for  fifteen  minutes. 

When  we  buy  anything  it  is  our  instinct  and  our  right  to  ap- 
praise it  beforehand  and  assure  ourselves,  as  far  as  our  judg- 
ment allows,  that  we  are  paying  for  just  what  we  get,  and  getting 
just  what  we  pay  for.  When  we  buy  a  barrel  of  flour,  a  suit  of 
clothes,  a  building,  a  watch  or  a  day's  labor,  we  first  satisfy  our- 
selves, by  shopping  round  or  otherwise,  that  we  are  getting  and 
giving  value  received.  But  in  our  ordinary  life  there  is  one 
glaring  exception  to  this  rule.  W^e  all  have  to  buy  social  service, 
community  service :  that  is,  what  our  local  and  state  authorities 
do  for  us.  We  have  to  buy  this  service  the  same  as  we  have  to 
buy  any  other  necessity  of  life,  but  we  are  not  allowed  to  ap- 
praise it,  to  say  how  much  of  it  we  are  getting,  what  it  is  worth 
to  us,  or  how  much  we  shall  pay  for  it.  Taxation  is  simply  col- 
lecting pay  for  community  service,  and  under  present  systems  it 
is  a  hit-or-miss  proceeding,  falling  like  the  rain  indeed,  upon 
the  just,  but,  unlike  the  rain,  usually  hitting  the  unjust  very 
lightly,  and  the  just  very  hard. 

I  wonder  how  many  of  us  appreciate  the  scope  of  this  great 
power,  tlie  taxing  power  of  the  state ;  how  far-reaching  in  its 
influence  and  how  evil  in  its  results  if  wrongly  used.  It  is  the 
supreme  power  of  the  whole  people.  It  is  the  one  thing  above 
all  others  that  determines  the  nature  of  our  individual  life  and 
existence,  whether  it  shall  be  a  mean  and  narrow  one,  or  a  full 
and  a  beautiful  one.     More  than  anything  else  in  life  it  marks 


202  SELECTED     ARTICLES 

for  us  cither  the  path  of  poverty  or  the  path  of  prosperity.  It 
is  the  power  that  turns  day  into  night  or  night  into  day;  it  is 
the  command  that  can  lay  waste  the  garden  and  make  it  look  like 
a  desert,  or  that  can  make  the  desert  bloom  and  blossom  like 
unto  a  garden.  It  has  the  power  to  destroy;  it  has  the  pozver  to 
create.  It  is  the  power  that  either  shuts  the  door  of  opporunity 
npo)i  labor  and  upon  capital,  or  that  opens  the  door  of  opportu- 
nity to  labor  and  to  capital. 

In  every  phase  of  life,  you  know,  comedy  and  tragedy  go  hand 
in  hand;  the  tear  follows  the  laugh  and  the  laugh  the  tear  and 
even  our  tax  system  is  no  exception,  for  it  can  give  you  many  a 
hearty  laugh  as  well  as  many  a  tear.  A  fellow  gets  drunk  and 
paints  the  town  red;  we  fine  him;  another  fellow  stays  sober 
and  paints  his  house  white  and  we  fine  him.  One  fellow  builds 
a  chicken  coop — we  fine  him  every  year  the  chicken  coop  is  in 
existence,  w^hile  the  fellow  who  robs  the  chickn  coop,  we  fine 
only  once.  The  man  who  uses  opportunity,  we  punish ;  the  man 
w4io  does  not  use  it  we  liberally  reward. 

Let  me  say  again  that  the  way  you  raise  your  public  revenue 
is  the  all-important  thing,  not  the  amount  you  raise.  This  is  be- 
cause a  tax  upon  land  values  operates  exactly  opposite  to  a  tax 
on  labor  values.  A  man  got  up  in  a  meeting  of  mine  and  said : 
"Oh,  what  difference  does  it  make  ?  We  have  got  so  much  money 
to  raise,  let  us  raise  it  any  way  we  can  get  it,  the  quicker  the 
better."  Says  I:  "Do  you  think  so?"  He  said:  "Certainly."  I 
said:  "Suppose  you  had  a  hundred  pounds  to  carry,  would  it 
make  any  difference  how  you  carried  it?"  He  answered:  "Not 
at  all."  "All  right,"  I  said,  "we  will  tie  it  to  your  left  leg  instead 
of  putting  it  on  your  right  shoulder."  Of  course  there  was  no 
answer.  Then  I  said:  "If  a  ship  had  a  cask  to  take  to  Europe, 
where  could  it  best  carry  it,  down  in  the  hold,  close  to  the  keel- 
son, or  throw  it  overboard  at  the  end  of  a  line  and  drag  it 
across?"  This  is  a  rough  illustration  of  the  importance  of  how 
we  raise  our  public  revenue.  We  can  raise  it  and  shut  the  door 
of  opportunity  to  labor  and  to  capital,  increase  the  cost  of  living 
to  every  human  being,  and  bind  unjust  burdens  grievous  to  be 
borne  upon  the  back  of  labor  and  capital— or  we  can  raise  it  in 
such  a  zi'ay  that  by  the  very  raising  of  it  we  relieve  labor  and 
capital  and  force  open  the  door  of  natural  opportunity  to  labor 
and  to  capital.  Let  me  explain  tliis  further,  for  here  is  the  whole 
point  and  nub  of  the  single  tax. 


SINGLE     TAX  203 

A  tax  that  falls  upon  anything  produced  by  labor  restricts 
the  production  o£  that  thing  and  increases  the  cost  of  living;  and 
(note  this),  the  failure  to  tax  land  values  has  exactly  the  same 
effect;  it  restricts  production;  it  raises  the  cost  of  living;  it 
lowers  v^ages ;  it  increases  the  price  of  land.  Untax  entirely  the 
land  of  this  city  tonight  and  land  prices  would  be  half  again  as 
high  before  morning.  Labor  and  capital  would  have  a  burden 
so  enormously  increased  that  they  would  stagger  and  fall  under 
the  load.  Outside  of  the  absurdity,  evil  and  dishonesty  of  it, 
how  perfectly  ridiculous  it  is  to  tax  the  things  that  w^e  want. 
Suppose  we  don't  want  dogs,  what  shall  we  do  with  them?  Oh, 
just  tax  them  and  they'll  go.  If  the  tax  were  high  enough  every 
ki-^d  in  town  would  disappear.  But  we  forget  that  it  has  the 
same  effect  upon  the  things  that  we  need,  the  things  that  enter 
into  our  life,  implements,  food,  raiment  and  shelter.  Tax  them 
and  you  make  them  dearer  and  you  make  them  scarcer. 

But  now  see  the  exactly  opposite  effect  of  taxing  land  values. 
While  taxing  labor  products  makes  them  scarcer  and  dearer, 
taxing  land  values  makes  land  more  plentiful  and  cheaper.  I 
don't  mean  that  you  can  increase  the  surface  of  the  earth  by 
taxation,  but  land  held  out  of  use  might  as  well  be  on  Mars  for 
any  good  it  does  us ;  so  as  taxing  land  values  makes  more  land 
accessible  as  well  as  making  it  all  lower  in  cost,  I  am  correct 
in  saying  that  it  makes  land  more  plentiful  and  cheaper.  Don't 
lose  sight  of  this  statement  for  a  moment.  It  is  the  heart  and 
soul  of  the  Single  Tax. 

It  is  a  cardinal  principle  of  the  single  tax  that  land  values  are 
public  property  because  they  are  not  made  by  labor  or  capital, 
but  are  the  sole  product  of  the  presence  and  expenditure  of  the 
community.  Our  present  system  of  taxation  and  land  handling 
is  a  flat  denial  of  this  principle. 

A  man  comes  to  me,  for  instance,  and  asks :  "What  do  you 
want  for  that  vacant  lot?"  I  say  to  him:  "Five  thousand  dol- 
lars." He  says:  "What,  five  thousand  dollars?  Great  Heavens, 
that  is  an  awful  price.  Why,  five  years  ago  you  only  paid  five 
hundred  for  it."  I  say :  "That's  a  fact,  but  let  me  tell  you  a 
few  things.  You  know  when  I  bought  that  lot,  this  street  wasn't 
even  graded ;  it  was  not  sewered ;  it  was  not  lighted ;  it  was  not 
policed.  This  was  a  miserable  town  to  live  in  then.  There  were 
very  few  churches ;  there  was  no  free  delivery  of  mail,  the  poor- 
est    kind  of  stores ;  there  wasn't  a  good  theatre  in  the  place ; 


204  SELECTED     ARTICLES 

there  was  no  fire  department — Oh,  pshaw !  \Miy,  it  was  the 
meanest  kind  of  a  hole  that  a  white  man  could  live  in,  and  I  paid 
all  that  lot  was  then  worth,  five  hundred  dollars;  but,  now,  see 
what  has  happened?  Population  has  moved  in.  Not  only  are 
the  streets  graded  and  the  town  paved,  sewered,  lighted  and 
policed,  but  we  have  here  a  splendid  fire  department,  a  sanitary 
department,  the  best  of  common  schools,  a  high  school,  a  good 
free  library,  free  delivery  of  mail,  best  of  stores  you  can  find 
anywhere — no  human  desire  but  what  can  be  satisfied  right  here 
— Oh,  this  is  some  town ;  this  town  is  worth  living  in  now,  and 
for  that  reason  this  little  bare  lot  is  worth  five  thousand  dollars." 
Now,  zcliat  am  I  selling  this  man?  Land?  Not  at  all.  I  could 
sell  him  a  piece  just  as  pretty  and  larger  hack  in  the  hush  for 
ten  dollars.  I  am  not  selling  him  lajid;  I  am  selling  that  man 
five  thousand  dollars'  zvorth  of  good  government,  of  social  ser- 
vice; not  service  that  I  rendered,  hut  that  the  community  renders 
and  pays  for  out  of  its  taxes. 

How  do  I  get  at  the  price  of  five  thousand  dollars  for  this 
land?  There  are  a  dozen  ways  of  figuring  it,  but  this  will  an- 
swer for  illustration.    I  sell  him 

Paved  and  sewered  and  lighted  streets $1000 

Police  and  fire  department 1000 

Good  and  cheap  transportation  service 1000 

Nearness  of  schools,  churches  and  stores 1000 

Advantages  of  social  life,  amusements,  etc.,  which  ac- 
company large  population 1000 


$5000 
And  when  I  have  given  my  customer  a  title  deed  to  these  things 
which  I  had  no  hand  in  creating,  and  have  taken  his  five  thou- 
sand dollars  and  salted  it  away  in  a  five  per  cent  mortgage,  what 
then?  ^A'hy,  the  unsophisticated  victim  will  put  up  a  house  on 
that  lot  and  under  the  guise  of  taxation  zuill  pay  over  again 
every  year  for  the  social  service  and  advantages  for  which  I  had 
already  collected  from  him  in  full  and  for  ever;  for  so  long  as  I 
can  find  a  safe  five  per  cent  investment,  this  man  zvill  pay  me 
and  my  heirs  after  me,  $250  a  year,  and  that  is  all  the  social 
services  of  that  tozvn  are  worth  to  him. 

Wiiilc  I  was  speaking  at  a  meeting  in  Buffalo  a  man  got  up 
to  ask  why  he  should  be  taxed  on  his  lot  to  support  the  high 
school  nearby.     "I  hain't  got  a  kid  to  send  to  it,  and  vacant  lots 


SINGLE     TAX  205 

don't  go  to  school,"  he  said..  I  encouraged  him  b}^  replying: 
"All  right,  friend,  go  ahead."  "Well,"  he  continued,  "why  should 
I  be  taxed  for  a  fire  department?  You  can't  burn  up  a  piece  of 
land,  and  that's  all  I  own.  Why  should  I  pay  to  support  a  police 
department?  Burglars  would  have  a  hard  time  to  get  away  with 
my  lot."  "That's  true,"  I  admitted.  "But  wait  a  moment.  Sup- 
pose you  took  a  man  tomorrow  morning  to  look  at  that  lot  with 
the  idea  of  selling  it  to  him.  Would  you  tell  him  what  you  have 
just  been  insisting  on  to  me?  That  a  lot  can't  burn  and  so  no 
fire  department  is  needed?  Not  much.  You  would  show  him  how 
handy  to  the  school  house  for  his  children  the  place  was.  You 
would  tell  him  that  this  was  just  the  spot  to  put  his  house  be- 
cause the  fire  department  was  just  around  the  corner  and  was  so 
much  on  the  job  that  if  he  lit  a  match  they  would  be  around  in 
a  jiffy  and  put  it  out;  that  you  had  the  best  police  department 
in  the  state,  fine  streets,  lights  and  pavements,  etc.,  and  that  all 
these  advantages  made  the  lot  well  worth  the  rather  elevated 
price  you  had  to  ask  him." 

Now  this  is  only  a  fair  instance  of  what  is  happening  a  thou- 
sand times  a  day  in  the  cities  and  towns  all  over  the  country. 
Do  you  need  any  other  or  further  proof  that  the  value  of  land 
is  the  true,  exact  and  automatic  measure  of  the  value  of  social 
service?  And  if  you  see  that,  can  you  name  any  other  equally 
just  sources  of  revenue  to  maintain  this  social  service  than  the 
land  value  which  the  social  service  creates?  Take  land  values 
for  public  revenue,  and  you  distribute  fairly  the  cost  of  govern- 
ment besides  letting  the  citizen  off  with  one  payment  instead  of 
the  two  he  makes  now;  once  to  the  individual  land  owner  and 
once  to  the  taxgatherer.  This  is  a  matter  that  everyone  is  vitally 
concerned  in,  although  too  few  voters  realize  it ;  like  one  man 
who  told  me  "he  wasn't  interested  in  the  land  question;  he 
worked  on  a  ferryboat  and  lived  on  the  fifth  floor!" 

One  of  our  main  troubles  has  been  that  we  haven't  caught  on 
io  the  fact  that  taxes  are  simply  payment  for  social  services. 
Another,  that  vje  have  had  no  idea  that  it  is  possible  to  measure 
exactly  the  value  of  social  service  or  to  obtain  from  each  in- 
dividual his  just  and  proper  share  of  the  cost  of  it.  Still  another 
trouble,  and  this  a  very  serious  one,  is  that  our  tax-laying  au- 
thorities have  almost  wholly  failed  to  realize  the  vital  importance 
of  the  "incidence  of  taxation" — that  is,  on  what  part  of  the  body 
politic  taxation  falls.    The  general  notion  has  been,  "We  need  so 


2o6  SELECTED     ARTICLES 

much  revenue;  what  difference  does  it  make  how  we  get  it?" 
and  with  that  go-as-you-please  idea  in  mind,  as  we  find  we  need 
revenue,  we  simply  grab  it  wherever  we  think  we  can  get  it  easi- 
est. Under  this  system,  from  those  who  show  evidence  of  doing 
business  and  helping  to  build  up  a  community,  we  take  what  we 
want  irrespective  of  the  social  service  rendered  them. 

The  leading  idea  among  taxation  "experts"  seems  to  be  to 
collect  from  people  according  to  their  ability  to  pay  without  ref- 
erence to  the  amount  of  social  service  they  buy.  How  would  we 
like  to  conduct  our  every  day  transactions  on  that  principle? 
You  pay  for  your  groceries  according  to  the  value  of  the  goods 
delivered  and  not  according  to  your  ability  to  pay.  Just  suppose 
that  a  man  went  into  a  store  with  an  $800  sealskin  overcoat  on 
and  stepped  up  to  the  counter  and  asked  the  girl  for  a  spool  of 
cotton,  and  the  girl  put  it  down  on  the  counter,  and  he  asked: 
"How  much?"  and  she  looked  him  over  and  said:  "Ten  dollars, 
please  !"  The  man  would  say :  "Great  heavens,  I  never  paid  more 
than  five  cents  for  it?"  The  girl  answers:  "Well,  we  have 
changed  our  way  of  doing  business ;  we  charge  now  according  to 
the  ability  of  the  people  to  pay,  not  according  to  the  value  of 
what  they  get."  Now,  that  is  exactly  what  we  do  in  our  tax 
system.  You  build  a  $5000  house  back  in  the  swamp,  and  the 
assessor  comes  along  and  charges  you  just  as  much  on  that  build- 
ing as  though  it  were  in  the  heart  of  the  town  on  a  lot  that 
receives  the  maximum  of  social  service. 

So  much  for  explanation.  Now,  let  us  get  down  to  brass 
tacks  and  see  how  this  is  going  to  practically  affect  you,  mc  and 
the  other  fellow.  Let  me  give  you  a  little  conversation  between 
myself  and  a  man  at  a  meeting  in  a  church  at  which  I  recently 
spoke.  He  asked  this  very  question :— "How  is  this  going  to 
affect  me?"  I  answered  his  question  with  another.  "Do  you  own 
around  here?"  "I  own  a  house  and  lot,"  he  said.  "How  big  ij 
the  lot?"  I  asked.  "Twenty  by  one  hundred  feet,  and  it  cost 
me  $700."  "What  is  your  house  itself  worth?"  He  said: 
"$3,500."  "You  paid  then  about  $4,200  all  together,  and  you  pay," 
I  hesitated,  "about  $80  a  year  taxes?"  "That's  about  right,"  he 
answered.  "What  is  next  door  to  you?"  "A  vacant  lot."  "What 
is  that  worth?"  I  asked.  "$700."  "Then  it's  not  worth  any  more 
or  less  than  yours,"  I  said.  "No,"  he  replied,  "It's  the  same 
street."  "What  is  on  the  other  side  of  your  house?"  "Another 
vacant  lot,"  he  said.    "What  do  those  fellows  pay?"    "$12  each," 


SINGLE     TAX  207 

he  replied.    "Let's  see,  then;  yon  pay  $80  and  they  pay  $12  apiece 
so  the  town  gets  $104  out  of  the  three  of  you?"    "That's  right'' 
he  said.     ''Well,"  I  continued,    "3^ou  did  a  respectable  thing  in 
putting  a  house  up,   and  they  are  just  holding  theirs   vacant." 
Ihats  the  size  of  it."     "Now,  then,"  I  concluded,  "if  all  three 
of  you  paid  5  per  cent  tax  on  the  valuation  of  your  land    you 
would  each  pay  $35,  and  from  all  three  there  would  be  collected 
^10:,,  or  $1  more  than  under  the  present  arrangement."    The  man 
thought   a    minute   and   then    he    asked:     "Is    that   single   tax?" 
Yes,    I  replied.     "Well,  then,"  said  he,  "I  am  a  single  taxer"* 
Is  there  anything  unfair  about  that?     These  other  men  are 
getting  exactly  the  same  service  from  the  community-the  proof 
of  that  IS  the  price  of  the  land  they  have  possession  of.     That 
they  do  not  use  it  is  entirely  wide  of  the  mark.    If  you  went  to 
a  hotel  and  got  the  best   room,  on  a  corner,  where  you  could 
rubber  up  both  streets,  and  worth  $5  a  day,  and  then  took  the 
key  and  stayed  away  a  week,  and  at  the  end  of  the  week  the 
.i?'t,rr  ^'^'T'"^  ^'^^  ^^^ith  a  bill   for  $35,   would  you   hand 
the  bill  back  and  say,  "I  didn't  use  the  room"?     If  ^ou  were  to 
try  on  that  plea  he  might  say  some  things  to  you  that  are  un- 
prmtable,  but  he  would  say  to  you  in  effect:  "You  kept  somebody 
else  from  using  it,  you  had  the  opportunity  to  use  it,  I  supplied 
you  with  utility,  and  this  hotel  doesn't  care  whether  you  use  it 
or  not-now  come  across  and  pay  your  bill."    If  you  were  going 
to  the  theatre  and  bought  two  seats,  and  did  not  use  one  of  the 
tickets  and  went  the  next  day  to  the  box-office  and  said  that  you 
didnt  use  the  ticket,   would  you   get  your  money  back?      You 
would  not!     We  don't  think  of  doing  such  things  in  our  busi- 
ness  we  do  business  on  the  single  tax  plan.   Take  an  office  build- 
ing, for  instance.    You  go  in  and  want  to  rent  an  office.    W^ould 
they  cnarge  you  in   accordance  with   the   business  you   are  in? 
Not  unless  they  were  running  an  extraordinary  risk  in  renting  to 
you    unless  you  were  running  a  gold  brick  game  or  something 
of  the  kind,  and  they  thought  they  could  put  something  over  on 
you.    If  you  were  running  a  legitimate  business,  they  would  say 
to  you  offices  here  are  worth  a  dollar  a  square  foot,  and  a  dollar 
a  square  foot  is  what  you  would  have  to  pay  for  it,     whether 
you  did  a  business  of  a  million  dollars  a  day  or  sat  at' your  desk 
and  wrote  letetrs  to  your  friends.    That  is  the  single  tax-pav  for 
what  you  get,  according  to  the  right  value  of  the  thing  you  are 
getting.    How  do  you  pay  for  groceries,  or  hats  or  clothes?    Ac- 


2o8  SELECTED     ARTICLES 

cording  to  the  value  of  the  thing  you  get.  But  we  have  been  in 
the  dark  in  the  past  and  strugghng  around  hke  a  bhnd  mule  in 
a  bog,  because  we  did  not  know  how  to  charge  for  social  service. 
That  is  the  only  trouble— we  didn't  know  how.  Today  we  know 
that  the  measure  of  the  value  of  social  service  is  land  value,  and 
land  value  only. 

All  improvements  in  a  toioi  add  to  land  values  and  to  the 
value  of  nothing  else.  If  you  took  a  badly  paved  street  in  your 
town,  and  paved  it  beautifully,  and  swept  it  twice  a  day  and 
sprinkled  it  with  rose-water,  what  would  go  up  in  value?  The 
furniture  in  the  homes  on  that  street?  Not  one  cent.  The  per- 
sonal property  in  the  stores  on  thai  street?  Not  one  cent.  The 
buildings  on  that  street?  Not  one  cent.  The  salaries  of  the  men 
who  lived  on  that  street?  Not  a  cent.  What,  then,  would  go  up 
in  value?  The  land  only — the  vacant  as  well  as  the  used.  Can't 
you  see  that  these  other  things  are  private  property,  services 
rendered  by  you  to  yourself,  and  are  in  no  way  related  to  the 
value  of  social  service?  What  I  do  with  that  lot  need  not  be  re- 
lated in  the  slightest  to  the  value  of  that  lot,  to  the  opportunity 
that  I  have  possession  of. 

In  every  town  I  go  to,  my  first  move  is  to  charge  down  to 
the  City  Hall  and  get  the  facts  of  that  town.    A  few  nights  ago 

I  spoke  in  a  place  called  R ,  New  Jersey,  and  before 

speaking  I  got  the  following  facts  from  the  town  records :  The 
population  was  given  as  6,729,  and  the  area  of  the  town  8,960 
acres.  The  expense  budget  for  the  year  was  $242,919.00;  that 
makes  for  the  population  about  $36.00  per  capita  per  year,  which 
is  nine-tenths  as  much  as  that  of  New  York  City.  Of  course  they 
have  a  high  tax  rate,  and  besides  that  high  asking  prices  for 
land.  Also  by  reason  of  the  large  extent  of  the  town  they  can- 
not give  it  all  adequate  public  service,  and  on  these  accounts,  and 
because  of  the  way  they  lay  their  taxes  the  place  is  not  growing 
as  it  should.  As  I  have  stated  before,  the  area  of  the  place  is 
8,960  acres.  In  that  area' they  are  allowing  for  streets  about 
107,500  lots  25  X  100.  Now,  every  lot  is  entitled  to  all  the  utilities 
that  the  town  gives  to  anybody;  but  suppose  you  build  on  the 
outskirts  a  house  costing  $5,000  ;  they  will  tax  you  at  least  $100 
a  year  on  that  house  (and  at  the  end  of  fifty  years  they  would 
have  the  house  and  you  wouldn't  know  it).  Perhaps  you  wake 
up  some  day  and  realize  you  are  paying  $100  a  year  in  taxes  on 
a  house  and  are  getting  practically  nothing  in  the  way  of  public 


SINGLE    TAX  209 

service.  Then  you  go  to  the  mayor  and  make  a  complaint  that 
you  haven  t  been  gettmg  any  poHce  protection,  or  any  use  of  the 
various  utihties,  and  he  sits  back  in  his  chair  and  Hstens  to  you 
patiently  and  then  says  that  he  will  take  the  matter  up  and  in- 
v-estigate  and  will  see  what  can  be  done.  Well,  he  can't  do  any- 
thmg  for  you,  and  he  knows  it.  All  town  officials  are  in  the  same 
fix.    One  mayor  told  me,  in  a  very  strong  voice,  that  his  was  "a 

^ 01  a  job, '  and  I  believed  him. 

Now  let  us  step  over  to  K ,  New  York.     A  town  of 

about  26,000,  which  has  been  there  since  the  Revolution.    It  occu- 
pies  an   acreage   of   5,248   or  62,976   lots   and   has   a   budget   of 
$483,000.     An  average  tax  of  $8.00  a  lot  would  give  this  city  a 
revenue  of  $503,000,  or  $20,000  more  than  they  get  now  by  tax- 
ing land  a  httle  and  industry  a  great  deal.     Under  a  5  per  cent 
tax  on  land  price  alone,  the  dearest  lot  in  town  would  pay  $300 
and  the  cheapest  $3,  whether  improved  or  unimproved,  and  cer ' 
tamly  no  home   owner  or  owner  of  improved  property  would 
object  to  this  form  of  taxation.    I  interviewed  a  man  that  owned 
the  costliest  lot  in  town;  he  holds  it  at  $6,000,  and  it  has  an  old 
obsolete    buiWing    on    it.     He    pays    around    $300    in    taxation. 
After  we  had  talked  a  while  he  said:    "If  they  would  let  me  put 
up  a  building  here  and  not  tax  me  for  it,  I  would  be  perfectly 
wil  ing  to  pay  $500  a  year  on  the  land.     I  will  put  up  the  very 
best  building  m  town,  if  they  will  just  guarantee  me  freedom 
from  tax  on  the  building,  but  as  long  as  they  go  on  the  present 
basis,  I  can  do  business  in  this  shanty."     They  could  give  three 
lots  to  every  family  in  that  town,  and  only  utilize  16,000  lots 
and  It  would  leave  46,000  vacant  lots.      The  mayor   sat  at  my 

right  when  I  was  talking  to  the  Board  of  Trade  in  K - 

and  when  I  sprung  this,  he  gasped,  and  said:  "He  always  knew 
that  the  darn  old  town  was  bigger  than  it  ought  to  be  "  The 
mayor  looked  at  me  and  said:  "You  do  not  mean  to  say  that 
there  is  anybody  m  the  town  paying  less  than  $8  a  lot  do  you?" 
1  said:  "There  is  a  bunch  of  property  assessed  as  farm 'lands  and 
It  is  m  the  heart  of  this  town,  which  is  certainly  not  a  farm  site  • 
It  is  assessed  at  a  valuation  of  some  $200  an  acre."  The  owner 
of  that  land  was  paying  taxes  about  50  cents  a  lot  per  annum 
but  If  you  wanted  to  buy  it,  you  would  have  to  pay  a  king's 
ransom.  ^ 

Everywhere  you  go  it  is  the  same  thing.    You  get  two  things 
out  of  this  wretched  system,  an  unnecessarily  expanded  town  and 


210  SELECTED     ARTICLES 

a  horrible  bill  of  costs  because  of  the  unnecessary  extension  of 
its  area. 

Nationl   Municipal   Review.   4:616-21.    October,    1915. 

Singletax  and  American  Alunicipalities.    Samuel  Danziger. 

In  a  letter  published  in  The  Public  of  March  31,  191 1,  Henry 
George,  Jr.,  explained  that  Vancouver,  like  many  other  munici- 
palities of  western  Canada,  raised  its  local  revenue  by  taxing 
land  values  only.  He  then  showed  that  because  the  tax  rate  was 
but  2  per  cent  on  a  very  low  valuation,  the  city  was  unnecessarily 
courting  land  speculation  "with  its  certain  penalty  of  enormous 
inflation  of  land  prices,  and  then  a  pricking  of  the  bubble  and  a 
dead  city  for  a  longer  or  shorter  period." 

Commenting  on   Mr.   George's   letter,   Louis   F.   Post   in   the 

same  issue  of  The  Public  said: 

There  is  nothing  new  about  the  desolating  effect  which  Con- 
gressman George  predicts  for  Vancouver  if  the  people  of  that  city 
content  themselves  with  the  degree  of  land  value  taxation  they  have 
now  while  their  exemption  of  improvements  progressively  stimu- 
lates land  values.  His  father  gave  warning  rnore  than  thirty  years 
ago  in  "Progress  and  poverty."  Observing  that  m  the  better  de- 
veloped countries  the  value  of  the  land  taken  as  a  whole  is  much 
more  than  sufficient  to  bear  the  entire  expenses  of  goyernment,  the 
author  of  "Progress  and  poverty"  wrote:  "Hence  it  will  not  be 
enough  merely  to  place  all  taxes  upon  the  value  of  the  land,  it 
will  be  necessary,  where  rent  exceeds  the  present  governmental 
revenues,  commensurately  to  increase  the  amount  demanded  in  taxa- 
tion, and  to  continue  this  increase  as  society  progresses  and  rent 
advances."  If  Vancouver  fails  to  heed  this  warning,  let  her  not 
account  for  the  inevitable  disaster  by  criticizing  the  singletax,  ot 
which  .she  now  boasts.  Her  plight  will  be  due,  not  to  the  degree  ^of 
singletax  she  has  adopted,  but  to  the  greater  degree  which  in  folly 
she  may  neglect  to  adopt. 

The  warning  was  disregarded,  and  the  inevitable  depression 
has  set  in.  But  Vancouver's  citizens  are  intelligent  and  have  not 
been  misled  into  putting  the  blame  on  the  singletax.  They  see 
that  they  are  on  the  right  road  in  taxation  matters,  even  though 
they  do  not  yet  seem  ready  to  extend  the  system  sufficiently  to 
put  an  end  to  industrial  depression.  They  have  shown  this  in 
electing  each  year  a  mayor  and  council  in  favor  of  retaining  the 
system.  At  the  municipal  election  in  January,  1915,  of  four 
candidates  for  the  mayoralty,  two  were  singletaxers.  The  two 
singletaxers  received  two  thirds  of  the  total  vote.  The  successful 
candidate  was  L.  D.  Taylor,  locally  known  as  "Singletax"  Taylor, 
who  was  mayor  in  1910  when  the  system  was  first  adopted. 
After  election  Mr.  Taylor  was  found  to  be  disqualified  to  serve 
and  a  new  election  was  ordered.  He  had  the  disqualification 
removed,  became  a  candidate  again  and  was  triumphantly  elected. 
So  Vancouver's  voters  have  surely  made  their  position  clear. 


SINGLE    TAX  2n 

^  There  seems  to  be  a  similar  situation  in  the  other  Canadian 
cities  that  have  local  singletax.  None  of  these  has  been  misled 
to  place  the  blame  for  a  widespread  industrial  depression  on  the 
advance  made  in  local  taxation  methods. 

The  Grain  grower's  association,  the  farmers'  organization  of 
western  Canada,  has  strongly  urged  adoption  of  direct  taxation 
ot  land  values  by  the  Dominion  government. 

In  1913  the  legislature  of  Pennsylvania  by  special  act  pro- 
vided that  in  the  cities  of  Pittsburgh  and  Scranton  the  assess- 
ment for  taxation  of  improvements  on  land  shall  be  gradually 
reduced  until  they  will  be  but  half  of  the  assessment  on  land  A 
beginning  has  been  made  at  putting  this  system  in  effect  Im- 
provements are  assessed  at  10  per  cent  below  land  values. 
1  hough  this  beginning  is  very  slight,  it  was  sufficient  to  alarm  the 
big  land  speculators  of  Pittsburgh,  and  these  with  the  help  of 
some  local  political  leaders  succeeded  in  putting  through  the 
legislature  of  this  year  a  bill  repealing  the  measure.  The  re- 
pealer passed  in  spite  of  protests  of  many  civic  organizations 
and  individual  citizens.  However,  Governor  Brumbaugh  wisely 
vetoed  It  and  in  his  veto  statement  referred  to  the  fact  that  the 
repealer  was  opposed  by  a  larger  group  than  had  been  heard  on 
any  other  bill. 

Pueblo,  Colorado,  adopted  a  singletax  amendment  to  its  char- 
ter in  1913.  This  is  not  to  go  into  full  effect  until  1916.  For  the 
present  year  improvements  are  supposed  to  be  taxed  at  one  half 
the  rate  of  land  values.  Unfortunately  the  tax  assessor  is  hos- 
tile, and  assessments  have  not  been  made  as  they  should  There 
has  consequently  been  no  fair  test.  This  must  be  remedied  and 
probably  will  be. 

Elections  on  the  question  of  adopting  local  singletax  have 
been  held  this  year  in  Colorado  Springs  and  Denver.  In  both 
places  the  proposition  was  defeated. 

In  California,  irrigation  districts  may  raise  all  irrigation  ex- 
penses by  a  tax  on  land  values  only.  A  number  have  taken 
advantage  of  this  until  there  is  now  a  combined  area  of  i  500 
square  miles  under  this  system.  Some  of  the  towns  in  this  dis- 
trict, such  as  Modesto  and  Oakdale,  have  advertised  the  fact 
that  this  system  prevails.  The  Oakdale  chamber  of  commerce 
has  been  especially  active  in  sharing  the  advantage  the  svstem 
confers  upon  the  town. 

In  Houston,  Texas,  Tax  Commissioner  J.  J.  Pastoriza  was  re- 


212  SELECTED     ARTICLES 

elected  in  March  by  a  vote  of  nearly  three  to  one  on  the  issue  of 
continuing  the  system  in  force  since  191 1  under  which  land 
values  were  assessed  for  taxation  at  70  per  cent  and  improve- 
ments at  25  per  cent.  However,  the  opponents  of  this  system 
have  since  secured  a  court  decision  declaring  it  unconstitutional. 

In  the  three  states  and  six  cities  where  the  single  tax  has  so 
far  been  a  political  issue,  the  combined  favorable  vote  has 
amounted  to  454,298. 

There  are  in  the  United  States  five  settlements,  known  as 
singletax  colonies  or  "enclaves"  in  which  the  corporation  or  trus- 
tees holding  title  to  the  land  devote  all  ground  rents  to  public 
purposes.  Since  state  laws  require  taxation  of  improvements  and 
personal  property,  the  colonies  reimburse  the  tenants  from  the 
rents  to  the  amount  of  the  tax  the  state  or  county  has  levied 
upon  them.  The  remaining  part  of  the  rents  is  used  for  local 
purposes.  These  colonies  are  Fairhope  in  Baldwin  county,  Ala- 
bama;  Arden  near  Wilmington,  Delaware;  Free  Acres  near 
Summit,  New  Jersey;  Tahanto  near  Harvard,  Massachusetts,  and 
Halidon,  near  Cumberland  Mills,  Maine. 

Concerning  these  a  good  account  is  contained  in  the  following, 
letter  in  The  Public  of  May  7: 

If  all  the  singletaxers  had  the  preconceived  idea  of  Fairhope, 
which  I  possessed  before  visiting  the  place,  they  would  probably 
regard  Deferred-hope  as  a  more  appropriate  name  for  the  colony 
than  the  one  it  bears.  My  surprise  and  gratification  were  immense 
when,  a  few  vears  ago,  I  set  foot  on  the  first  location  where  the 
land  is  not  regarded  as  private  property.  The  pier,  with  its  com- 
modious wharf  extending  over  a  third  of  a  mile  from  shore,  and 
along  which  the  rails  of  the  People's  railroad  extend;  the  lovely  little 
park  with  its  magnificent  live  oaks  and  palmettos;  the  inn  at  which 
we  supped  that  first  night,  and,  above  all,  the  closely  settled  village, 
with  its  numerous  dwellings  of  decidedly  substantial  character, 
many  of  which  are  surrounded  by  carefully  kept  citrus  groves  or 
truck  gardens;  all  of  these  convey  to  the  observer  a  state  of  pros- 
perous contentment  which  no  amount  of  dry-as-dust  figures  could 
do.  One  note  that  was  particularly  pleasant  is  the  spirit  of  democ- 
racy which  singletaxers  have  always  predicted  will  result  from  the 
abolition  of  special  privilege.  I  take  it  that  this  is  due  to  the  fact 
that  in  spite  of  the  inequalities  in  wealth  (many  residents  came  to 
Fairhope  in  quite  comfortable  circumstances),  the  absence  of  any 
special  privilege  has  obviated  the  necessity  on  the  part  of  any 
person  or  group,  to  arrogate  to  themselves  a  special  superiority. 

Another  interesting  fact,  which  I  dug  out  of  the  old  files  of  the 
Courier,  and  other  records  which  Mr.  Galston  w^as  kind  enough  to 
place  at  my  disposal,  was  this:  At  the  start,  the  singletax  was  a 
mere  incident  to  a  lot  of  more  or  less  communist  schemes  that  the 
founders  of  Fairhope  had  on  their  program.  But  one  by  one  these 
vagaries  demonstrated  their  own  inadequacy  and  so  suffered  the 
fate  of  the  unfit.  Rather  a  neat  proof  of  the  fact  that  even  devoted 
enthusiasm  cannot  prolong  the  existence  of  a  fundamental  fallacy. 
The  original  1.50  acres  on  which  the  most  important  part  of  the 
village  of  Fairhope  is  situated,  were  purchased  for  $771,  and  are 
today  valued  conservatively  at  over  $100,000.     Besides,  the  village  is 


SINGLE     TAX 


213 


much  more  uniformly  built  up  and  presents  a  decidedly  more  sub- 
stantial character  than  does  the  average  town  of  its  size  in  the 
south  or  west. 

From  Fairhope  I  went  to  Arden,  which  place  being  fovmded  by 
artists,  conveys  the  artistic  note  more  than  any  of  the  other  single- 
tax  colonies  or  enclaves.  It  is  just  as  Frank  Stephens  said:  "Art 
cannot  find  its  true  expression  except  where  the  people  are  free  and 
their  artistic  perceptions  only  then  make  themselves  manifest." 
Space  does  not  permit  a  detailed  description  of  this  delightful  spot, 
so  close  to  one  of  our  great  cities,  yet  so  immeasurably  removed 
from  it  in  an  economic  sense. 

Halidon  and  Tahanto,  the  two  enclaves  founded  by  Fiske  War- 
ren, are  also  well  worth  a  visit.  Here  as  in  the  other  enclaves,  the 
residents  are  freed  from  the  payment  of  taxes  on  their  labor  and 
wealth,  and  while  each  man  lives  upon  his  own  freehold,  he  has  not 
been  forced  to  pay  a  capitalized  rent  to  a  landlord.  Fiske  Warren 
has  a  plan  whereby  an  enclave  having  been  started,  it  can  grow 
indefinitely  by  its  own  momentum,  as  a  result  of  the  constant  in- 
crease in  land  values,  which  twenty  years'  experience  demonstrates 
can  be  counted  on  with  certainty.  He  went  into  this  at  some  length 
and  his  plan  seems  to  stand  every  test,  but  it  would  require  con- 
siderable space  to  enlarge  upon  it  and  I  defer  doing  so  until  some 
future  time. 

The  following  figures  mark  the  growth  of  the  gross  and  net 
incomes  (after  paying  taxes  and  "fixed  charges")  for  the  four 
enclaves: 

Fairhope  Arden 


1904 

1905 

1906 

1907 

1908 

1909 

1910 

Gross 
Rental 

$990.35 

1,520.67 

2,255.69 

2,172.51 

3,027.65 

3,195.08 

3,499.78 

Net 
Rental 

$1,' 127. 77 
1,349.76 
1,229.89 
1,467.13 
1,481.58 
1,277.18 
1,907.71 
1,593.47 
1,946.47 
2,479.14 
1,438.39 

anto 

Net 

Rental 

$4.00 

33.00 

106.00 

180.00 

633.00 

385.00 

619.46 

Gross 
Rental 

$908'.  27 
1,631.71 
1,834.19 
1,932.60 
2,213.19 

Hali^ 
Gross 
Rental 

$48.00 

87.00 

240.00 

353.42 

Net 
Rental 

1911 

1912 

1913 

1914 

1915 

1909 

3,907.28 

4,457.62 

5,664.74 

5,896.30 

5,792.14 

Tah 
Gross 
Rental 
$10.00 

$702.47 
1,330.14 
1,501.67 
1,511.71 
1,711.39 

don 

Net 
Rental 

1910 

66.00 

1911 

1912 

1913 

1914 

1915 

152.00 

180.00 

633.00 

753.00 

1,737.17 

$197'.  72 

Thus  the  entire  economic  rent  taken  for  public  vise  in  the  four 
enclaves  (the  figures  for  Free  Acres  are  not  available),  totals 
$10,422.50,  and  after  paying  off  all  state  and  county  taxes,  there 
remained  at  the  disposal  of  the  various  communities  the  sum  of 
$3,867.96.  In  Halidon  and  Tahanto,  in  addition  to  paying  the  taxes, 
a  definite  amount  is  devoted  each  year  to  paying  off  the  original  cost 
of  the  land,  and  this  charge  is  to  be  continued  in  small  payments 
until  the  debt  shall  have  been  amortized  in  one  hundred  years.  In 
Arden  this  is  being  done  more  rapidly.  A  debt  without  interest 
(loaned  by  Joseph  Fels),  is  being  paid  off  in  ten  annual  instalments. 
The  plan  of  payment  adopted  in  the  Fiske  Warren  enclaves,  admits 
of  unlimited  expansion  in  the  future.  As  land  values  increase,  so 
does  the  borrowing  power  of  the  enclaves,  and  thus  new  lands  can 


214  SELECTED     ARTICLES 

be  acquired,  additional  land  values  created  and  more  land  pur- 
chased from  money  borrowed  thereon.  Such  a  system  provides  a 
safe  and  lucrative  investment  or  annuity  for  those  having  surplus 
funds,  and  will  at  the  same  time  help  to  demonstrate  to  unbelievers 
the  practicability  of  the  singletax. 

It  should  be  said  in  explanation  of  the  apparent  falling  off  in 
net  revenue  of  Fairhope  for  1915,  shown  by  the  figures  in  the 
letter,  that  at  the  time  a  suit  was  pending  against  the  corporation 
in  which  the  complainant  had  urged  its  dissolution,  holding  that 
its  charter  was  illegal.  This  naturally  put  extra  expense  on  the 
colony  and  reduced  its  revenue.  Since  then  the  supreme  court  of 
Alabama  in  a  unanimous  decision  has  unheld  the  corporation. 

In  his  message  to  the  legislature  of  South  Dakota  in  January, 
Governor  Francis  M.  Byrne  urged  submission  of  an  amendment 
to  the  constitution  that  would  permit  classification  of  property 
for  taxation.  He  showed  the  folly  of  taxing  the  man  who  im- 
proves his  land  more  than  the  one  who  holds  similar  land  idle. 
The  legislature  adopted  his  suggestion  and  submitted  the  amend- 
ment. A  similar  amendment  carried  at  the  election  in  North 
Dakota  last  November.  At  the  same  time  another  amendment 
of  the  same  nature  received  a  majority  of  votes  cast  on  it  at  the 
election  in  Nebraska  but  failed  to  receive  the  number  required 
by  the  constitution  to  carry. 

A  straight  out  singletax  amendment  received  17  votes  out  of 
39  in  the  Oklahoma  state  senate  last  March.  In  the  Delaware 
house  an  amendment  permitting  singletax  received  17  favorable 
votes  to  8  in  opposition.  However  24  affirmative  votes  were  re- 
quired for  pasage.  In  the  Texas  house  a  graduated  land  value 
tax  measure  received  a  majority  of  eight  votes  but  needed  a  two 
thirds  vote  to  carry.  In  the  Arkansas  Legislature  a  similar  meas- 
ure passed  the  house,  but  failed  in  the  senate. 

The  singletax  movement  is  clearly  moving  onward. 

Annals  of  the  American  Academy.  61:252-6.  September,  1915. 

War — Or  Scientific  Taxation.   C.  H.  Ingersoll. 

Two  important  factors  which  mark  the  growth  of  civilization 
are  an  increasing  control  over  the  forces  of  nature,  and  a  more 
mimite  division  of  labor.  The  latter  makes  us  to  a  large  extent 
dependent  on  others,  and  this  has  never  been  more  conclusively 
shown  than  during  the  present  war.  Although  we  are  a  neutral 
nation,  the  struggle  has  affected  every  one  of  us  in  an  economic 
sense.    Some  have  lost — others  gained,  so  far. 


SINGLE     TAX  215 

At  any  rate,  the  war's  costs  are  enormous  and  will  continue 
to  be.  Professor  Charles  Richet,  of  the  University  of  Paris, 
estimated  some  years  ago  that  a  general  European  war  would 
cost  approximately  $50,000,000  a  day.  Recent  figures  from  Lon- 
don indicate  that  the  annual  expense  of  England  and  her  allies 
will  approximate  $8,000,000,000  and  the  total  annual  direct  ex- 
penditures of  the  nations  at  war  will  probably  reach  $16,000,000,000. 

Statistics  of  capital  known  to  be  normally  available  for  in- 
vestment and  securities  are  compiled  year  b}^  3-ear  by  the  Belgian 
Financial  Publication  Le  Moniteur  des  Interets  Materials  and 
these  show  the  average  annual  amount  available,  for  the  past 
few  years,  to  be  about  $4,000,000,000.  One  year's  zvar  will  con- 
sume approximately  four  years'  savings!  A  costly  plaything — 
W^ar. 

And  I  have  not  yet  spoken  of  the  indirect  costs.  The  enor- 
mous destruction  of  property,  the  almost  complete  disorganiza- 
tion of  the  agencies  of  production  and  distribution,  the  economic 
loss  sustained  by  the  almost  unbelievably  large  loss  of  life — 
these  are  factors  which  cannot  even  be  approximated. 

Who  will  pay  for  this  war?  Will  the  people  of  the  nations 
at  war  stand  all  the  costs,  or  will  they  be  distributed  among 
humanity  in  general?  I  believe  that  we  will  all  have  to  bear  a 
share  of  the  burden,  and  that  it  will  fall  most  heavily  on  those 
who  are  least  fitted  to  stand  up  under  it — the  consumers.  The 
consumer  is  the  laborer  in  more  than  nine  cases  out  of  ten. 
Under  the  present  system  of  taxation,  business  will  stand  the 
first  costs.  But  a  tax  upon  business  is  a  tax  upon  capital  and 
industrial  enterprise,  on  which  the  consumer-laborer  depends 
for  employment.  If  business  thrives,  the  consumer-laborer  pays 
the  tax  in  the  form  of  higher  prices ;  if  the  tax  is  so  high  that 
business  cannot  be  conducted  at  a  profit,  he  pays  it  in  the  form 
of  unemployment.  In  other  words,  he  gets  it  coming  or  going. 
Perhaps  it  will  be  in  the  form  of  higher  prices— perhaps  in- 
creased unemployment — or  in  some  other  manner,  but  these  costs 
will  be  paid.  For  many  months  we  have  been  paying  the  costs 
in  the  form  of  disorganized  and  dislocated  business,  and  by 
special  taxes  on  proprietary  and  toilet  articles,  telephone  and 
telegraph  messages,  and  so  on. 

The  government  must  be  supported— that  is  not  open  to  dis- 
cussion. Under  the  present  system  governmental  revenues  are 
quite  largely  secured  from  import  duties.  When  this  source  is 
cut  off,  or  lessened,  as  it  has  been  since  the  war  started,  we  pay 


2i6  SELECTED     ARTICLES 

the  penalt}-  in  another  way — and  alwajs  through  taxes  levied 
upon  those  who  have  least  cause  to  have  to  bear  them.  Taxa- 
tion as  now  in  vogue  is  all  bad;  taxes  fully  deserve  the  evil 
reputation  they  bear.  Taxation  today  means  taking  from  people 
something  they  think  they  own;  hence  their  persistent  objec- 
tions. This  is  evidence  of  the  wrong  basis  for  taxation,  and 
proof  that  it  is  interfering  with  normal  life,  industry  and  pros- 
perity. If  we  want  to  do  away  with  war,  let  us  first  remove  the 
cause — unjust  taxation.  Can  business  prosper  while  being  driven 
from  pillar  to  post  by  the  tax  assessor?  Or  is  it  better  not  to 
have  business  prosper?  A  stranger  might  reasonably  infer  that 
the  prosperity  of  business  is  decidedly  against  public  policy. 

What  is  the  present  financial  status  of  American  industries? 
We  are  blessed  with  good  crops,  for  one  thing.  In  addition  to 
having  plenty  for  home  consumption,  we  have  enough  to  feed 
several  of  the  warring  nations  and  some  of  the  neutrals.  The 
farmer  instead  of  worrying  about  how  he  will  pay  the  interest 
on  his  mortgage,  now  spends  his  earnings  assiduously  studying 
the  pages  of  the  automobile  catalogue.  He  is  selling  the  products 
of  the  field  at  top  prices,  and  so  far  at  least,  the  increased  prices 
of  the  things  he  has  to  buy  do  not  equal  his  increased  revenues. 

It  is  the  opinion  of  2,000  leaders  of  thought  and  action  in  the 
financial,  mercantile  and  industrial  field  that  "while  money  is 
cheap,  credit  is  subnormal."  There  is  a  super-abundance  of 
money  in  some  sections  of  the  country  mainly  in  the  larger 
centers.  This  is  to  be  expected,  for  the  sequence  of  a  period  of 
business  depression  is  always  an  accumulation  of  money  at  the 
large  centers  and  a  closer  scrutiny  of  credit  that  results  in  the 
elimination  of  those  who  were  hopelessly  crippled  by  the  panic 
but  were  temporarily  carried  along  by  bankers  until  better  finan- 
cial conditions  permitted  of  their  rehabilitation  through  bank- 
ruptcy or  reorganization,  with  less  shock  to  the  community  and 
with  greater  salvage  to  their  creditors.  Economy  is  general,  and 
reports  indicate  that  in  many  instances  it  is  deliberate  and  is 
being  followed  as  a  matter  of  choice  and  not  of  necessity.  The 
Federal  Reserve  Law  is  making  money  easier  to  secure.  We 
have  a  brisk  home  trade  and  a  strong  export  trade  in  foodstuffs 
and  war  materials.  Our  "balance  of  trade"  has  reached  a  record 
figure.  Our  citizens  are  "Seeing  America  First."  Millions  of 
dollars  are  being  kept  at  home  this  year  through  force  of  neces- 
sity. 


SINGLE     TAX  217 

This  war  was  not  desired  by  any  nation  now  involved  in  it, 
nor  by  the  people,  nobility  or  ruling  class  of  any  country,  and 
was  beyond  the  power  of  the  world's  financiers  to  have  averted. 
It  is  a  commercial  war,  always  raging,  due  to  the  fact  that  each 
nation  is  always  unconsciously  fighting  to  extend  its  area  of 
free  trade.  The  existence  of  tariff  walls  is  the  prime  cause  of 
national  and  racial  hatreds.  On  the  other  hand,  the  examples  of 
the  German  Zollverein  and  the  United  States  of  America  show 
the  mutual  advantage  and  amity  that  flow  from  state  autonomy 
and  the  freedom  of  commerce. 

"Suppose"  with  me  for  a  moment.  Suppose  that  there  were 
tariff  walls  between  the  various  states  of  the  Union.  Now  then — 
Michigan  automobile  manufacturers  are  trying  hard  to  build  up 
an  export  trade  in  South  America.  The  cheapest  method  of 
transportation  is,  we  will  assume,  by  Mississippi  River  boats,  to 
New  Orleans.  But  to  reach  the  Mississippi  or  Ohio,  the  Michi- 
gan manufacturers  would  have  to  pass  through  Illinois,  Indiana 
or  Ohio,  and  there  pay  a  duty  on  their  products.  Think  of  the 
jealousy  and  hatred  this  would  cause!  We  are  so  accustomed  to 
free  trade  within  the  United  States  that  our  senses  have  failed 
to  grasp  the  importance  of  the  cause  which  has  thrown  Europe 
into  a  state  of  indescribable  turmoil. 

The  real  cause  of  the  European  war  was  not  the  shooting  of 
an  Austrian  noble  by  a  Serb — the  real  cause  was  an  economic  one 
— the  unconscious  fight  of  each  nation  to  extend  its  area  of  free 
trade.  Russia,  for  example,  is  a  nation  without  a  good  seaport. 
What  is  more  natural  then,  than  for  her  to  look  with  envy  at 
German  soil  along  the  Baltic,  and  at  the  region  of  the  Darda- 
nelles ?  What  would  prevent  her  from  shipping  her  goods  from 
German  ports?  The  answer  is  the  existence  of  tariff  walls.  If 
she  sent  her  goods  through  Germany,  she  would  be  taxed.  This 
is  a  condition  which  has  existed  for  centuries,  has  caused 
numberless  wars,  and  will  continue  to  create  discord  and  ill- 
feeling  until  governments  remove  tariff  barriers  and  gain  their 
support  from  nature's  creation  instead  of  from  the  fruits  of 
man's  labor. 

The  remedy — the  only  insurance  against  war — is  a  more  scien- 
tific, rather  a  scientific,  system  of  levying  taxes.  Under  the 
present  system  unimproved  land  goes  almost  free  on  the  theory 
that  it  is  earning  no  income,  and  in  disgregard  of  the  fact  that  it 
is  a  stumbling  block,  a  drag  on  development,  and  that  it  is  grow- 


2i8  SELECTED     ARTICLES 

ing  valuable  by  the  industrious  efforts  of  others.  Build  a  house, 
or  even  paint  one,  or  beautify  your  property,  and  you  must  pay 
a  penalty.  Buy  a  suit  of  clothes,  a  barrel  of  sugar  or  a  ton  of 
coal,  and  you  will  have  paid  another  fine  that  must  discourage 
your  effort  to  live  comfortably.  Our  present  system  is  a  direct 
encouragement  to  speculative  inaction,  and  at  exery  turn  a  blow 
at  honest  industry. 

The  site  tax,  or  tax  on  land  values  would  not  disturb  existing 
titles  to  land  at  all,  but  by  surrounding  users  of  land  with  fair 
conditions,  not  now  existing,  would  make  these  titles  absolutely 
secure.  The  force  of  the  change  would  fall  on  those  non-users 
or  partial  users  of  tracts  they  are  holding  for  an  advance  in 
price.  For  example,  of  two  adjoining  pieces  of  land,  one  is 
occupied  by  a  building  and  other  improvements,  and  the  other 
is  in  its  raw  natural  state.  The  owner  of  the  first  pays  a  high 
tax  on  every  building  and  its  contents — on  even  his  fences, 
ditches,  grading  and  so  on,  as  well  as  a  high  tax  on  the  land  it- 
self, while  his  neighbor  paj^s  a  low  tax  on  the  land  alone.  A  tax 
on  site  values  would  remove  all  tax  from  the  improvements  and 
take  the  full  rental  values  of  the  land  only,  without  considering 
in  the  slightest  degree  the  improvements,  thus  lowering  the  tax 
paid  by  owner  No.  i.  The  tax  on  the  unimproved  plot  would  be 
increased  three  or  four  times,  bringing  it  to  the  actual  economic 
value,  corresponding  to  the  adjoining  land.  And  what  would  be 
the  net  result  of  this?  First,  an  industrious  man's  taxes  would 
be  lowered,  and  he  would  be  encouraged  to  make  further  im- 
provements. Second,  the  "dog  in  the  manger"  would  realize  that 
there  was  no  longer  any  profit  in  holding  land  idle ;  so  he  would 
use  it,  build  upon  it,  cultivate  it,  and  employ  labor,  thus  raising 
wages.  Third,  another  house  would  be  in  the  market,  lowering 
rents  for  houses  and  more  produce  would  be  sent  to  market, 
contributing  to  cheaper  prices  for  such.  Fourth,  as  the  reven- 
ues from  land  would  more  than  suffice  for  all  expense  of  govern- 
ment, every  other  tax  would  be  abated,  so  that  the  general  public 
would  actually  be  exempt  from  taxation!  The  land  would  take 
care  of  it  all,  and  justly  so,  because  these  same  people  have  made 
every  dollar  of  these  values.  "Every  other  tax  would  be  abated." 
This  would  mean  the  end  of  war  and  its  terrors.  There  would 
be  little  incentive  to  reach  out  for  more  land  if  every  country 
levied  taxes  on  site  values  alone. 

Great  Britain  made  a  step  in  the  right  direction  by  removing 


SINGLE     TAX  219 

tariff  barriers  and  establishing  free  trade.  But  England  did  not 
dig  down  to  the  roots  of  the  question — and  as  a  result  England 
has  perhaps  the  worst  tax  system  of  any  nation.  A  few  nobles 
— law-lords  as  well  as  land-lords — hold  the  greatest  share  of  the 
land,  and  are  encouraged  to  hold  it,  idle  and  useless,  by  a  tax 
system  which  lets  unimproved  land  off  nearly  free  and  puts  a 
high  tax  on  improvements. 

The  whole  object  of  any  system  of  taxation  is  that  it  shall  be, 
certain,  just,  easily  collected  and  shall  not  be  a  burden  to  in- 
^dustry,  thrift  and  initiative.  Our  present  system,  in  order  to  be 
certain,  is  unjust,  for  it  is  not  placed  on  those  who  should  and 
are  best  able  to  bear  it.  Under  the  present  tax  laws,  those 
whom  we  have  a  habit  of  thinking  pay  the  tax  are  in  reality  tax 
collectors  from  those  who  rent,  use  and  purchase.  Such  factors 
as  labor,  sea  and  rail  transportation,  supply  of  capital  and  interest 
rates  do,  of  course,  contribute  to  the  prosperity  of  American  in- 
dustries— and  I  speak  of  industries  in  the  broad  sense.  But 
back  of  these  factors,  and  more  fundamental,  is  another  factor 
— taxation.  Until  we  have  just  and  scientific  taxation — wars  or 
no  wars — the  prosperity  of  American  industries  will  be  uncer- 
tain. Until  tariff  walls  are  broken  down  and  taxes  levied  from 
site  values  only,  we  must  always  be  prepared  for  the  outbreak 
of  war. 


Temple  Artisan.  17:119-21.  January,  1917. 
Rent  and  the  Cost  of  War.     Sydney  L.  Hilliard. 

The  question  has  been  asked,  "Where,  before  war  breaks  out, 
is  the  money  which  is  later  spent  on  the  war?" 

It  has  been  shown  that  it  is  not  in  the  laborers'  pockets,  be- 
cause the  laborers  are  better  off  when  the  war  has  broken  out, 
and  that  they  have  more  and  not  less  during  the  war.  It  is  not 
being  distributed  in  legitimate  profits  because  legitimate  profits 
are  greater  after  the  war  has  broken  out.  It  is  not  being  dis- 
tributed in  interest  because  interest  is  higher  after  war  has  bro- 
ken out.  It  must  be  somewhere,  in  some  location  that  is  hurt 
by  the  outbreak  of  war.  Money  comes  from  somewhere  for  war 
purposes.  Therefore  the  people  who  had  that  money  before  the 
war  must  be  poorer.     Who  are  they? 

They  are  owners  of  rents  and  of  spurious  capital.     By  spu- 


220  SELECTED     ARTICLES 

rious  capital  is  meant  various  bonds  and  stocks  that  represent 
merely  the  power  to  tax  industry  and  which  do  not  represent 
real  bonafide  industrial  machinery  at  all.  And  principally  they 
are  the  owners  of  economic  rent. 

It  has  been  asked  why  France  made  such  a  quick  recovery 
after  1870.  Before  1870  one  third  of  the  wealth  of  France 
went  in  rents.  The  owners  of  these  rents  had  to  be  kept  by 
France  in  idle  luxury.  The  war  broke  land  values  into  nothing. 
France  had  not  this  money  to  pay  away  to  useless  aristocracies 
so  she  was  able  to  pay  for  the  war  with  it,  and  later  to  pay  the 
indemnity,  too.  And  in  addition  to  this  the  demand  for  produce 
so  increased  that  every  worker  had  plenty  to  do  at  good  wages, 
and  w-as  therefore  able  to  buy  the  produce  of  other  workers, 
and  "this  condition  caused  the  war  to  be  not  only  not  a  disability 
to  France,  but  a  positive  benefit. 

In  England  before  the  great  war  one  third  of  the  national 
income  went  direct  to  the  pockets  of  the  ducal  landowners. 
These  men  constituted  a  vastly  greater  charge  upon  English  pro- 
duction in  the  long  run  than  any  war,  big  or  little,  has  ever 
done.  This  charge  of  one  third  of  the  national  income  has  been 
going  on  for  ages,  and  always  increasing  in  volume.  It  is  a 
total  national  loss.  There  is  absolutely  no  come-back  from  these 
ducal  families.  One  third  of  the  nation  has  to  w-ork  for  them, 
and  they  do  nothing  in  return.  Nothing  reaches  this  condition 
but  the  Single  Tax  and  war.  The  single  tax  we  cannot  get— not 
yet;  war  we  have.     What  does  war  do? 

The  war  has  sent  thousands  of  the  British  aristocracy  to  the 
front  where  they  fight  for  their  living;  it  has  sent  the  country 
estates  to  the  bargain  counter  at  such  figures  as  never  were 
heard  of  before — they  are  almost  giving  them  away.  Even  in 
the  big  cities  land  sales  at  former  figures  have  abruptly  stopped, 
and  in  Paris,  with  the  German  army  in  sight,  land  values  ceased 
to  exist.  Should  the  kaiser  really  set  foot  in  force  on  British 
soil  the  value  of  London  real  estate  would  vanish. 

To  revert  to  our  original  proposition, — "Where,  before  war 
breaks  out,  is  the  money  which  is  later  spent  on  v/ar?" 

It  is  inherent  in  the  price  of  land ;  it  inheres  in  rent ;  it  goes 
into  the  pockets  of  a  few  owners  of  economic  rent  who  are  just 
as  direct  a  charge  on  the  community  as  is  w^ar.  Wipe  these 
people  and  their  charge  out  and  you  can  easily  pay  for  your  war. 
Take  away  this  national  charge  of  one-third  of  the  national  in- 


SINGLE     TAX  221 

come  to  the  owners  of  the  soil  and  you  can  keep  your  war  going 
in  perpetuit}^  and  never  miss  the  money.  You  are  simply  spend- 
ing money  that  is  already  lost.  You  are  not  spending  money  on 
the  war  that  you  already  had;  you  are  spending  money  on  the 
war  that  some  one  else  already  had  to  the  infinite  detriment;  are 
throwing  away  bad  money,  money  that  could  otherwise  be  put 
to  a  worse  use  than  war,  namely,  luxury  and  degenerac}'. 

As  it  is  in  Europe,  so  will  it  be  in  America  if  a  real  war  ever 
breaks  out  here.  If  the  combined  European  fleets  were  bom- 
barding New  York,  and  you  owned  New  York  real  estate  you 
would  not  expect  to  realize  very  much  on  your  property.  Still 
less  could  you  realize  if  the  combined  European  armies  were 
encamped  around  New  York.  Since  the  wars  have  been  going  on 
in  Mexico,  rents  have  almost  disappeared  and  much  land  value 
has  entirely  so.  But  in  Mexico  the  destruction  has  gone  beyond 
the  wiping  out  of  land  value  and  has  destroyed  actual  necessary 
commodities. 

Henry  George  said  that  "All  taxation  ultimately  falls  on 
rent."  War  is  taxation.  It  falls  on  rent.  Then  comes  an  added 
advantage.  It  breaks  loose  the  foundations  of  industry  which 
so-called  over-production  has  bound  up.  It  enables  the  workers 
to  get  to  the  machinery  of  production  and  the  idle  land  and  pro- 
duce goods  which  they  by  this  time  have  money  enough  to  buy. 
The  state,  which  before  the  war  was  simply  a  negative  observer 
of  a  cancer  eating  its  own  vitals,  nov/  becomes  a  positive  agent 
in  spreading  employment,  wealth,  and  general  business.  The 
state  demands  everything  that  can  be  produced,  and  at  good 
prices.  Now  everyone  is  in  demand,  and  at  good  wages.  Before 
the  war  the  aristocracy  could  not  buy  the  products  of  mill  and 
mine  and  field ;  the  aristocracy  couldn't  consume  these  products, 
therefore  the  mills  shut  down.  War  can  consume  them,  so  the 
mills  open  up  at  full  speed  and  wages !  "Where,  before  war  breaks 
out,  is  the  money  which  is  later  spent  on  war?"  Answer:  In  the 
pockets  of  the  owners  of  economic  rent.  War  breaks  this  down 
and  distributes  it  amongst  the  workers  in  payment  for  value 
received.  How  can  we  produce  this  condition  in  time  of  peace? 
Answer :  By  doing  away  with  economic  rent  through  the  imposi- 
tion of  the  single  tax,  and  then  using  that  wealth  to  buy  up  the 
product  of  the  national  toil  to  be  used  for  the  benefit  of  the 
whole  people. 


222  SELECTED    ARTICLES 

Conference  of  Charities  and  Corrections.    Proceedings. 
1915:528-38. 

Shifting  of  Taxation  to  Land  Values  as  a  Means  of  Relieving 
Congestion  and  Poverty.     Frederic  C.  Leubuscher. 

Today  a  larger  proportion  of  the  population  of  the  United 
States  is  out  of  work  than  at  any  time  since  the  establishment 
of  this  republic — ^yes,  since  the  first  colonies  fringed  the  eastern 
seaboard.  Of  course,  the  European  v^ar  is  somewhat  respon- 
sible for  the  increase,  though  according  to  protectionist  logic  we 
should  be  abounding  in  prosperity;  for  the  war  has  eliminated 
competition  with  a  great  part  of  the  "pauper  labor  of  Europe." 
Even  before  the  war  began,  however,  unemployment  had  reached 
its  then  high-water  mark.  A  year  ago  last  winter  it  was  esti- 
mated that  in  New  York  State,  alone,  there  were  a  half-million 
wage-workers  out  of  jobs;  and,  with  an  average  of  three  de- 
pendents to  each  worker,  at  least  one  and  a  half  million  men, 
women  and  children  were  starving  or  on  the  verge  of  want — 
over  15  per  cent  of  New  York  State's  population.  Note  that 
that  was  about  a  half  year  before  the  war  began. 

This  problem  of  unemployment  demands  immediate  solution, 
Ex-President  Taft,  when  asked  for  the  remedy,  answered  in 
ignorance  and  despair,  "God  knows."  There  are  many  men  and 
women  who  think  they  know  the  remedy  and  are  teaching  it. 
They  say  that  this  country,  instead  of  failing  to  support  its 
hundred  millions  of  population  could  support  in  luxury  the  six- 
teen hundred  millions  of  the  earth,  with  abundance  of  room  and 
production  to  spare.  They  argue  that  all  of  man's  material 
wants — food,  clothing  and  shelter — are  produced  in  only  one 
fundamental  way — by  the  application  of  labor  to  land.  As 
population  increases,  so  does  the  demand  for  food,  labor  and 
shelter.  Naturally,  there  should  follow  an  increased  demand 
for  labor;  instead  of  which  we  have  a  lessened  demand.  Why? 
Here  are  millions  of  empty  willing  hands;  there  are  millions  of 
unused  fertile  lauds.  Why  do  not  the  hands  get  at  the  land? 
Because  something  has  come  between  the  hands  and  the  lands. 
If  that  "something"  can  be  got  out  of  the  way,  charitable  insti- 
tutions will  find  increasingly  less  for  them  to  do. 


SINGLE     TAX  223 

Rural  Conditions 

Despite  the  fact  that  over  half  of  the  immigrants  of  the  past 
two  decades  were  peasants,  46.3  per  cent  of  our  population  in 
1910  lived  in  cities  and  towns  containing  over  2,500  people, 
while  in  1880  this  proportion  was  only  29.5  per  cent.  During 
the  decade  1900-1910  our  urban  population  increased  38.4  per 
cent,  the  rural  only  9.4  per  cent.  Hence  the  "back-to-the  land" 
cry;  but  this  is  futile  unless  farming  can  be  made  profitable. 
Land  banks  and  systems  of  rural  credits  are  indications  that 
this  is  appreciated. 

Another  measure  of  relief  is  the  parcel  post  which  has  ended 
the  express  companies'  extortions.  The  farmers,  themselves,  are 
beginning  to  eliminate  the  middleman.  All  these  give  some 
measure  of  relief,  but  in  doing  so  really  increase  the  burden ; 
for  they  tend  to  make  the  land  more  valuable.  Our  tax  system 
compels  the  average  family  to  pay  $180  a  year  in  local,  state  and 
federal  taxes  and  in  the  consequent  higher  prices.  Small  farmers 
are  particularly  hard  hit.  They  run  heavy  risks  on  their  crops 
and  cannot  strike  for  high  wages.  No  legislature  has  yet  sug- 
gested a  minimum  wage  for  small  farmers,  though  in  1910  there 
were  about  840,000  farms  of  less  than  20  acres  and  317,000 
under  10  acres. 

In  1900,  about  35  per  cent  of  the  occupiers  of  farms  were 
tenants,  in  1910  nearly  ;^7  per  cent ;  and  while  the  number  of 
farm  owners  and  managers  increased  during  this  decade  by  7.9 
per  cent,  the  number  of  farm  tenants  increased  16.3  per  cent — 
more  than  twice  as  rapidly.  The  value  of  farm  lands  increased, 
during  this  decade,  118.1  per  cent — over  fifteen  billions  of  dol- 
lars. In  1910  nearly  one-fifth  of  the  farm  acreage  of  the  coun- 
try was  in  holdings  of  one  thousand  acres  or  more  (there  were 
several  holdings  of  half  a  million  acres  or  over),  while  only  one 
per  cent  of  the  acreage  was  in  farms  of  less  than  twenty  acres. 
Out  of  6,361,000  farms,  however,  one  one-third,  or  2,254,000, 
were  of  less  than  fifty  acres.  Obviously,  the  value  of  improve- 
ments— buildings,  ditching,  machinery,  cattle,  stock,  crops,  tools, 
etc. — is,  compared  with  the  value  of  the  land,  much  larger  on 
small  farms  than  on  large  ones.  The  Senate  Commission  on 
Agricultural  Credit  reported,  last  year :  "Under  these  conditions 
— rising  land  values  and  cumulative  taxation — the  land  is  slowly 


224  SELECTED    ARTICLES 

but  siireh'  passing  from  resident  ownership  to  landlord  owner- 
ship. Farm  tendency  is  undeniably  on  the  increase."  A  rela- 
tively few  thousand  people  own  a  large  proportion  of  the  farm 
acreage  of  the  country. 

From  1900  to  1910,  farm  land  values  increased  almost  exactly 
twice  as  much  as  the  value  of  live  stock,  two  thirds  more  than 
the  value  of  implements  and  machinery  and  fifty  per  cent  more 
than  the  value  of  farm  buildings. 

Out  of  the  original  domain  of  the  United  States,  amounting 
to  1,441,436,160  acres,  by  June  30,  1909,  725,136,983  acres,  includ- 
ing most  of  the  best  land  of  the  country,  had  been  disposed  of 
to  individuals  or  corporations  or  for  specified  purposes,  while 
324,478,060  acres  had  been  included  in  reservations. 

At  least  ninety  per  cent  of  the  value  of  the  average  farm 
consists  of  improvements  and  only  ten  per  cent  is  site  value. 
The  bare  site  value  of  a  farm  selling  for  $5,000  is  usually  $1,000. 
In  cities,  conditions  are  almost  reversed.  Of  the  $8,000,000,000 
total  assessed  value  of  New  York  City's  real  estate  about 
$5,000,000,000  is  land  or  site  value,  leaving  only  about 
$3,000,000,000  for  the  value  of  the  buildings.  So  that  a  system 
that  taxes  improvements  and  land  values  at  the  same  rate,  bears 
more  heavily  on  the  rural  than  on  the  urban  dweller.  Strange 
to  say,  the  farmer  is  the  most  violent  opponent  of  the  movement 
to  remove  their  tax  from  improvements. 

Urban  Conditions 

In  almost  every  American  city  of  25,000  or  more  there  is  a 
land  monopoly  similar  to  the  rural  land  monopoly,  while  in  most 
large  cities  the  concentration  of  land  ownership  is  even  more 
marked. 

Eight  families,  estates  and  corporations  own  about  one- 
twenty-third  of  the  value  of  land  in  New  York  City.  The  sites 
of  nine  buildings  in  the  "loop"  district  of  Chicago  represent  about 
one-thirty-fifth  of  the  land  value  of  the  city.  Seven  families, 
estates  and  companies  own  about  one-fifteenth  of  the  acreage  in 
the  District  of  Columbia,  exclusive  of  parks,  governmental  res- 
ervations, streets  and  exempt  land. 

The  atrocious  housing  conditions  existing  in  most  American 
cities  are  well  known.  While  New  York  City's  population  is 
packed  tier  upon  tier  in  three  to  seven  story  tenements,  crowded 
three   to   five   in   a    room,  similar  room    overcrowding,    due    to 


SINGLE     TAX  225 

high  rents,  is  prevalent  in  many  if  not  most  other  cities,  and  in 
not  a  few  sanitary  conditions  are  worse  than  in  New  York. 

What  connection,  if  any,  is  there  between  monopoly  in  urban 
and  agricultural  land,  and  that  involuntary  poverty  which  it  is 
the  avowed  purpose  of  the  National  Conference  of  Charities  and 
Correction  to    exterminate? 

This  can  best  be  ascertained  by  studying  the  results  of  land 
monopoly  and  our  tax  system  under  which  land  is  taxed  at  so 
low  a  rate  that  the  owners  are  enabled,  and  even  encouraged, 
to  hold  it  out  of  use.  It  must  be  borne  in  mind  that  most  of  the 
mineral  and  agricultural  lands  have  been  given  away,  practically, 
to  individuals  and  corporations,  while  most  of  the  big  land 
holders  in  cities  secured  their  holdings  for  a  small  part  of  the 
present  selHng  value — or  got  it  free. 

The  most  important  results  are  the  following : 
(i)     Land  is  held  out  of  use — and  the  amount  of  employ- 
ment is  reduced. 

(2)  Manufacturing,  commerce,  trade,  production  and  in- 
dustry in  general  are  heavily  taxed,  and  hence,  curtailed;  for  it 
is  a  truism  that  the  power  to  tax  is  the  power  to  destroy  every- 
thing— except  the  use  of  the  land. 

(3)  The  consuming  power  of  the  workers  is  reduced,  which 
also  curtails  employment. 

(4)  Money  is  sunk  in  high  prices  for  land,  upon  which  un- 
earned and  inflated  prices  the  current  rate  of  interest  in  the  form 
of  rent  is  demanded. 

(5)  Governments,  local,  state  and  federal,  borrow  money  for 
improvements  and  expenditures,  which  should  be  met  by  current 
taxation  on  land  values,  that  are  made  by  all  the  people  in  the 
community. 

Tax  rates  on  full  land  values  vary  from  over  two  per  cent 
in  certain  boroughs  of  New  York  City,  to  less  than  one  per  cent 
in  some  rural  districts.  The  heavier  the  carrying  charges  the 
more  quickly  will  the  owners  of  land  either  improve  it  themselves, 
or  sell  it  at  a  reasonabe  price  to  some  one  who  wishes  to  do  so. 
Were  the  tax  rate  on  full  land  values  increased  to  three  or  four 
per  cent,  a  much  larger  acreage  of  farm  lands  would  be  used, 
and  would  be  used  more  productively,  i.e.,  intensively,  while 
suburban  land  near  large  cities,  instead  of  being  left  vacant  and 
unsighth-,  would  be  used  for  gardening.  Vacant  lots  in  cities 
would  similarly  be  improved  sooner,  with  the  result  that  rents 


226  SELECTED     ARTICLES 

would  be  reduced  and  home  ownership,  directly  or  through  co- 
partnership societies,  would  be  facilitated.  More  employment 
would  naturally  result. 

The  London  Conference  on  Unemployment  in  1908,  recom- 
mended : 

That  drastic  legislation  for  taxing  land  values  and  for  enabling 
public  authorities  to  compulsorily  acquire  land  on  the  most  reason- 
able terms,  is  urgently  needed  to  bring  all  land  into  useful  and 
productive  occupation. 

The  English  Parliamentary  Land  Enquiry  Committee  re- 
ported last  year,  after  considering  the  arguments   for  a  national 

tax  upon  land  values : 

A  careful  review  of  the  above  considerations  leads  us  to  the 
conclusion  that  the  arguments  in  favor  of  the  principle  of  a  national 
site  tax  as  one  of  the  sources  of  national  revenue  are  unanswerable. 

The  total  annual  cost  of  government,  local,  state  and  federal, 
is  approximately  $2,987,000,000  for  current  expenses.  The  total 
revenue  secured  by  taxing  land  values  is  only  about  $650,000,000. 
Four-fifths  of  the  cost  of  government  (approximately 
$2,200,000,000)  is  paid  by  taxes  upon  industry,  labor,  and  the 
products  of  labor,  since  all  taxes,  except  those  on  land  values, 
are  derived  from  these  sources.  The  annual  tax  rate  upon  all 
producers  and  agents  of  production — buildings,  machinery,  tools, 
mortgages,  merchandise,  crops  and  other  personal  property- 
varies  from  one  per  cent  to  about  two  per  cent.  This  is  a  fixed 
charge  upon  production,  a  millstone  around  its  neck,  and  it 
inevitably  curtails  production.  All  taxes,  except  those  on  land 
values,  are  shifted  on  to  the  consumer  of  the  goods  or  articles 
taxed,  or  the  user  of  the  services  taxed.  Income  and  inheri- 
tance taxes  likewise  cannot  be  shifted,  but  as  only  about  five 
per  cent  of  the  $2,987,000,000  are  raised  from  these  taxes,  they 
may  be  considered  negligible  quantities  in  the  discussion  of  this 
problem.  In  passing  I  might  add  that  a  large  increase  of  the 
land  value  tax  will  reduce  most  of  the  swollen  fortunes  that  pay 
the  income  and  inheritance  taxes. 

The  English  Parliamentary  Land  Enquiry  Committee,  quoted 
above,  reported  further : 

Owing  to  the  inclusion  of  the  value  of  buildings  and  other  im- 
provements in  the  basis  of  assessments,  the  present  rating  (local 
tax)  system  hampers  industry  in  general  and  agriculture  in  par- 
ticular. .  .  .  The  total  or  partial  exemption  of  buildings  and  other 
improvements  from  rates  (local  taxes)  would  stimulate  the  develop- 
ment of  industry  and  agriculture  and  encourage  the  provision  of 
working  class  houses. 


SINGLE    TAX  227 

Obviously,  money  spent  for  taxes,  direct  or  indirect,  cannot 
be  spent  for  food,  clothing  and  shelter.  If  the  cost  of  govern- 
ment were  met  by  taxing  land  values  most  families  would  be 
saved  from  $100  to  $130  a  year. 

Were  twenty  million  families  each  to  spend  annually  only 
$100  more  for  food,  clothing  and  shelter,  this  would  mean  an 
increase  of  two  billion  dollars  in  consumption,  and  of  course 
would  provide  much  adidtional  employment. 

The  selHng  price  of  land  is  its  untaxed  or  clear  price.  This 
net  selling  price  of  the  land  of  the  country  is  at  present  at  least 
sixty  billion  dollars.  An  annual  increase  in  the  value  of  land  of 
only  4  per  cent  means  an  increase  of  $2,400,000;  while  the  average 
annual  increases  in  the  value  of  farm  lands,  from  1900  to  1910, 
was  nearly  12  per  cent,  and  farm  lands  were  worth  in  1910  over 
twenty-eight  billions.  Within  ten  years,  under  the  prevailing 
tax  rates  on  land,  the  selling  price  of  land  in  this  country  will 
be  about  one  hundred  billion  dollars.  This  forty  billion  dollar 
increase  in  the  value  of  land  will  go  to  a  relatively  few  people, 
although  created  by  the  industry  and  thrift  of  all  the  people, 
and  by  public  improvements  paid  for  by  all.  Before  land  can  be 
used,  this  increased  price  must  be  paid  for  it,  or  a  return  in  the 
form  of  rent,  say  five  per  cent  net,  paid  the  owners.  Money  is 
thus  withdrawn  from  productive  purposes — in  which  peole  would 
otherwise  be  employed — to  pay  tribute  to  privilege  and  monopoly, 
thereby  increasing  interest  rates,  and  further  manacling  legiti- 
mate industry. 

Estimating  the  ground  rent  at  about  six  per  cent  (out  of 
which  land  taxes  are  paid)  the  land  owners  of  the  country  se- 
cure nearly  three  billions  of  dollars  a  year  ground  rent,  net. 
Land  values  increase  approximately  $2,200,000,000  a  year  net 
(i.e.,  above  assessments,  etc.).  The  net  profits  of  land  owner- 
ship are  thus  around  five  billions  of  dollars  a  year.  In  spite  of 
this  fact,  all  governments,  local,  state  and  federal,  controlled  as 
they  are  by  land  speculators,  are  heavy  borrowers.  The  total 
interest  bearing  governmental  debt  of  the  country  is  about  four 
and  a  half  billions  of  dollars.  The  annual  net  increase  in  the 
debt  varies  from  two  hundred  millions  to  four  hundred  millions, 
according  to  the  improvements  undertaken.  Three  and  a  half 
to  four  per  cent  is  a  fair  average  interest  rate;  so  that  the  total 
annual  interest  paid  on  governmental  debt  is  nearly  $160,000,000. 
New  York  City,  alone,  pays  nearly  $50,000,000  a  year  interest  on 


228  SELECTED     ARTICLES 

the  municipal  debt,   a  large  part  of  which  bears   four  per  cent 
interest,  or  more. 

In  ten  years  with  heavy  taxation  of  land  values,  we  could 
pay  oflF  all  government  debts  and  meet  all  the  expenses  of  gov- 
ernment, and  still  leave  land  owners  a  reasonable  recompense 
for  their  labor  in  collecting  ground  rents. 

Limitations 

Too  great  results  should  not  be  claimed  for  transferring  taxes 
on  buildings  to  land  values,  or  even  for  the  abolition  of  all  taxes, 
except  those  on  land  values.  Neither  change  will  usher  in  the 
millennium. 

Labor  exchanges  may  be  needed  under  the  single  tax;  but  if 
they  are,  more  for  the  purpose  of  telling  employers  where  they 
can  get  workers,  than  to  dig  up  a  few  jobs  for  many  workers. 
City  dwellers  will  not  desert  the  cities  en  masse.  More  recre- 
ational and  educational  opportunities  will  be  needed  in  the  coun- 
try districts,  just  as  they  are  to-day,  to  compete  W'ith  "The  Great 
White  Way"  and  educational  opportunities  of  the  cities.  Land 
banks,  labor  legislation,  including  workmen's  compensation,  co- 
operation, industrial  insurance  and  other  enlightened  social 
measures,  may  for  some  time  be  required  under  the  single  tax. 
A  marked  distinction,  however,  should  be  noted.  Under  our 
present  tax  system,  much  of  the  benefits  of  these  measures  inure 
to  land  owners;  under  the  single  tax,  and  to  a  less  degree  with 
taxes  on  buildings  transferred  to  land  values,  the  benefits  of 
these  measures  will  go  to  the  workers. 

Conclusion 

To  exterminate  involuntary  poverty,  w^orkers  of  every  sta- 
tion, and  of  whatever  occupation  must  secure  the  values  which 
they  create  and  produce.  At  present,  a  few  (relatively)  land 
monopolists  secure  most  of  the  land  values  and  ground  rents 
which  the  people  of  each  community  create  and  earn.  This 
enormous  fund  must  be  recovered  for  the  creators — all  the  peo- 
ple— before  involuntary  poverty  can  be  exterminated.  The  only 
effective  method  of  doing  this  is  to  tax  ground  rents  into  the 
public  treasury,  and  thus  relieve  the  workers  of  the  burdensome 
taxes  now  levied  upon  them,  thereby  increasing  employment  and 
wages. 


SINGLE     TAX  229 

Mr.  Clarence  Darrow,  the  labor  attorney,  put  the  situation  as 
follows : 

Private  ownership  of  land  means  increasing  wealth  for  the  few 
and  increasing  poverty  for  the  masses.  Workingmen  take  no  ac- 
count of  fundamentals,  any  more  than  other  folks.  Millions  of 
workingmen  have  organized  themselves  into  unions  to  attempt  the 
well-nigh  impossible  task  of  controlling  the  labor  market  instead 
of  doing  the  fundamental  thing,  namely,  changing  conditions  under 
which  they  live.  If  a  small  fraction  of  the  millions  that  have  been 
spent  on  labor  unions  had  been  spent  on  fundamentals  there  would 
be  no  need  of  labor  unions  today. 

When  we  learn  that  the  land  belongs  to  all  of  us  and  to  each  only 
so  much  as  he  can  use,  then  we  will  befree  men — no  need  for  labor 
unions  then;  no  need  to  legislate  to  keep  men  and  women  from 
working  themselves  to  death;  no  need  to  legislate  against  the 
white  slave  traffic.  "When  it  pays  to  behave  men  will  behave. 
They'll  do  it,  because  they  want  to.  There  will  be  no  class  distinc- 
tions in  that  time,  no  awful  poverty,  and  no  awful  wealth. 

While  I  do  not  agree  with  Mr.  Darrow  that  labor  unions  will 
be  unnecessary  under  the  regime  of  the  single  tax,  I  do  believe 
that,  when  the  dream  of  Henry  George  has  been  translated  into 
fact,  wars  between  capital  and  labor  will  cease. 


Single  Tax  in  Relation  to  Public  Health 

Lewis  Jerome  Johnson 

The  Single  Tax  should  affect  the  public  health  in  at  least 
two  important  ways,  vis. : 

1.  By  diminishing  poverty  and  thus  removing  a  fruitful 
source  of  disease ;  and 

2.  By  rationalizing  the  tax  system  and  thus  making  it  easier 
to  get  adequate  funds  for  the  support  of  public  health  activities. 

Taking  up  these  points  in  tlieir  order — I  hardly  need  enlarge, 
in  this  presence,  on  the  destructive  effect  of  poverty  upon  the 
public  health.  Undernutrition,  overwork,  overanxiety,  overcrowd- 
ing, bad  air,  ignorance  of  laws  of  health  and  hygiene,  inability  to 
pay  for  proper  medical  attendance  and  care,  filth,  alcoholism  and 
other  destructive  vices  are  all  characteristic  of  our  teeming  slums 
and,  to  a  greater  or  less  degree,  are  fostered  by  poverty  every- 
where. These  are  all  conditions  incompatible  with  normal  human 
life.  The  result  is,  accordingly,  wide-spread  disease  and  prema- 
ture death  with  all  their  terrible  consequences  to  society  as  a 
whole — to  rich  as  well  as  poor.  Not  long  since,  I  heard  one  of 
the  most  honored  leaders   in  the    splendid  field  of   preventive 


230  SELECTED     ARTICLES 

medicine  declare :  "The  employer  who  raises  the  pay  of  his  help 
does  more  to  stop  tuberculosis  than  all  we  doctors  can  do." 
Clear  as  was  his  testimony  as  to  the  bearing  of  poverty  on  pub- 
lic health,  almost  equally  impressive  to  me  was  the  possible  im- 
plication that,  master  as  he  was  and  is  of  the  more  obvious 
branches  of  his  specialty,  he  had  not  yet  given  vital  economics 
enough  study  to  realize  that  wages  are  not  to  any  publicly  im- 
portant degree  in  the  control  of  an  individual  employer.  Many 
another  leader  of  public  thought  has  drifted  into  so  narrow  a 
view  of  his  specialty  that  he  has  failed  to  behold,  and  perhaps 
has  even  failed  to  look  for  the  vision  of  bright  hope  which  vital 
economics  holds  out  to  those  who  have  eyes  to  see.  By  vital 
economics  I  do  not  mean  the  conventional  political  science  of  the 
schools,  frequently  dubbed  the  "dismal"  science.  I  mean  the 
science  of  the  production  and  distribution  of  wealth  as  an  ap- 
plied science  that  man  should  face,  study  and  develop,  with  the 
intention  of  finding  in  it  some  light,  with  the  intention  of  using 
its  teaching  to  solve  human  problems,  to  bring  something  to 
pass,  even  Mmay  be,  to  eliminate  the  poverty  which  is  prover- 
bially the^^^uction  of  the  poor,  and,  what  may  be  almost  as 
disastroua^^Bublic  evil,  the  ever  haunting  dread  of  poverty 
which  opp^SRs  and  fetters  the  fairly  well-to-do  and  even  the 
rich.  Let  economics  be  studied  with  the  care  and  constructive 
purpose  with  which  sanitarians,  bacteriologists  and  engineers 
study  their  other  problems  (for  economics  is  a  problem  of  every 
profession)  not  merely  as  part  of  the  fascinating  search  for 
truth  for  truth's  sake,  but  also  for  the  establishment  of  truth  for 
suffering  humanit^^'s  sake.  Let  economics  be  discussed  as  you 
and  I  discuss  our  other  professional  problems,  in  the  spirit  in 
which  I  am  glad  to  have  the  honor  and  privilege  of  accepting 
your  invitation  to  address  you  to-day.  I  believe  that  the  result 
of  such  study  will  be  the  development  of  an  inspiring  science, 
not  a  dismal  science,  and  one  which  has  much  to  suggest  toward 
the  lightening  of  your  task,  and  toward  the  enhanced  safety  and 
happiness  of  civilized  man.  Its  relation  to  political  econoni}^,  as 
the  term  is  now  used,  may  be  expected  to  be  much  like  that  of 
modern  engineering  to  pure  mathematics.  Tangible  results  from 
our  discussion  of  to-day  may  not  be  immediate,  but  I  believe  it 
is  the  natural  function  and  destiny  of  men  like  you,  men  of 
applied  science  training  or  bent  of  mind,  regardless  of  profession, 
to  lead  in  securing  such  results — for  whatever  may  be  said  for 


SINGLE     TAX  231 

the  more  literary  or  bookish  mind,  nurtured  on  precedent, 
steeped  in  the  past,  it  can  be  hardly  said  to  be  signally  construc- 
tive in  its  effect  on  great  public  problems. 

Momentously  beneficent  as  has  been  the  contribution  of  ap- 
plied science  in  the  last  century  and  a  quarter — in  your  field  and 
in  my  field — I  firmly  believe  the  same  spirit  entering  the  field  of 
the  great  social  and  political  problems  is  destined  to  render  a 
parallel  and  perhaps  still  greater  service.  It  cannot  be  natural 
that  so  many  of  the  most  industrious  should  spend  their  lives  in 
misery  and  want  in  these  days  when  the  command  of  steam  and 
electricity  has  brought  to  man  the  power  to  produce  necessaries 
and  comforts  of  life  in  quantities  simply  undreamed  of  a  few 
years  back.  And  if  it  is  not  natural  that  poverty  should  per- 
sist, it  needs  only  the  removal  of  its  artificial  causes  to  have  it 
disappear.  It  is  appropriate  for  applied  science  men,  men  who 
expect  and  are  expected  to  make  things  of  importance  happen — 
and  to  do  it  even  in  the  face  of  serious  obstacles — tq^e  attracted 
to  this   problem.  d 

I  will  now  attempt  to  state  some  of  the  basi^Sdoms,  as  I 
see  them,  of  vital  economics.  i^|p 

All  wealth,  all  the  material  things  of  life  prod^^rby  human 
agency  and  for  which  we  give  our  money,  come  from  the  use  of 
land.  Land  is  essential  for  their  production;  a  right  of  way 
over  land  is  essential  for  having  them  brought  to  us;  land  is 
essential  for  factories,  wharves,  warehouses,  banks,  markets,  and 
every  other  step  in  the  processes  of  production  and  distribution 
of  goods.  The  use  of  land  by  labor  is  essential  to  the  production 
and  distribution  of  all  the  wealth  produced  each  year  on  this 
planet.  The  use  of  land  is  essential  for  maintaining  a  home,  a 
church,  a  school.  Including  as  does  the  word  land  (in  the  eco- 
nomic sense)  all  the  gifts  of  nature,  it  is  not  hard  to  see  that 
land  is  the  basic  necessity  of  human  life.  No  man  produced  it. 
It  is  the  common  heritage,  as  it  is  the  common  necessity  of  all 
men.  The  conditions  of  its  ownership  and  use  demand,  accord- 
ingly, our  first  and  closest  attention. 

Equally  patent  is  the  fact  that  some  land  is  vastly  better 
suited  for  getting  a  living  and  enjoying  life  than  other  land,  i.e., 
some  land  is  vastly  more  valuable  than  other  land.  To  what  is 
this  value  due,  and  who  gets  it,  and  in  return  for  what?  The 
main  factor  in  the  value  of  the  most  important  land,  we  may 
say  practically  the  only  factor  in  Massachusetts,  is  the  assem- 


2Z2  SELECTED     ARTICLES 

blage  of  people  into  communities.  Each  resident  of  such  a  local- 
it}'  secures  an  increased  labor  efficiency  and  comfort  due  to  the 
division  of  labor,  possible  only  in  centers  of  population.  He 
enjoys  also  a  comparative  economic  security  due  to  nearness  to 
a  large  number  of  jobs,  or  a  large  market,  or  a  large  labor  sup- 
ply. There  are  various  other  causes  for  the  drift  of  people  to 
cities.  Much  of  this  drift  is  natural,  but  no  small  part  of  it  is 
due  to  needless  burdens  laid  by  our  tax  laws  upon  farm  and 
village  life.  Urban  land  offering  to  its  occupants  such  attrac- 
tions is  consequently  in  sharp  demand  and  its  market  value  goes 
up  accordingly.  Land  in  centers  of  population,  such  is  the  com- 
petition for  it,  commands  a  price  of  millions  of  dollars  per  acre. 
For  example,  as  a  minor  but  near-by  illustration  of  the  value  of 
urban  land,  the  present  assessed  value  of  the  land  of  Boston, 
Cambridge  and  Somerville  alone  is  greater  than  that  of  all  the 
rest  of  the  state  of  Massachusetts  put  together,  greater  than  all 
the  other  city  land  and  all  the  country  land  from  Barnstable  to 
Berkshire  and  from  Essex  to  Dukes.  Again — a  farm  worth  $50 
per  acre  half  a  mile  wide  and  girdling  the  earth  ten  times  would 
not  quite  equal  in  value  the  assessed  value  of  the  bare  land  of 
New  York  City. 

The  income  from  these  enormous  community-made  values 
now  flows,  in  the  main,  into  the  pockets  of  individuals,  in  return 
for  practically  nothing. 

Such  a  situation  at  once  challenges  attention. 

It  would  seem  natural,  moreover,  to  inquire,  in  the  face  of 
our  poverty  and  disease  problem,  whether  such  a  vitally  impor- 
tant resource  as  valuable  land  is  used  to  its  capacity,  and  if  not, 
wh}'  not ;  and  whether  and  how  evil  conditions  in  this  quarter 
may  be  remedied. 

It  can  be  readily  shown  that  there  is  room  in  our  little  Massa- 
chusetts, a  mere  speck  on  the  map  of  this  country,  to  house  the 
w^hole  population  of  the  United  States  in  detached  one-family 
houses,  five  to  six  persons  in  a  house,  with  a  quarter  of  an  acre 
of  ground  per  house.  Even  then  the  density  of  population  of 
the  state  would  be  no  greater  than  that  of  Boston — and  more 
than  one  half  of  Boston  land  area  is  vacant — and  only  one 
eighth  as  dense  as  that  of  Manhattan.  We  have  obviously  only 
scratched  the  resources  of  this  country.  Germany  with  her 
65,000,000  people  is  prosperous  in  a  space  one  fifth  smaller  than 


SINGLE  TAX  249 

and  paid  the  people  of  Oregon  its  price.  We  think  we  made  a 
mistake  when  we  sold  it.  We  have  taken  it  away  from  you,  by 
vote.  We  are  not  going  to  give  you  its  value,  nor  your  money 
back,  either.  That  is  loaned  out  at  interest  for  the  school  fund. 
But  we  are  honest  people,  and  will  give  you  the  first  chance 
to  lease  it,  for  the  full  rental  value,  on  our  own  terms,  for  five 
years."  What  will  all  men  and  women  think  of  us?  The  single- 
taxers  say  this  is  a  moral  question.  It  is.  The  State  now  has 
$6,500,000  in  the  school  fund  from  the  sale  of  these  lands.  Our 
children  will  be  going  to  school  on  the  interest  from  stolen 
money,  if  this  amendment  carries. 

We  challenge  the  constitutionality  of  this  law,  as  attempting 
to  take  property  without  due  process,  contrary  to  the  United 
State  Constitution,  in  that,  first,  it  levies  a  tax  of  the  full  rental 
value,  without  regard  to  taxing  needs,  and  is,  therefore,  as  said  in 
Henderson  Bridge  Co.  vs.  Henderson,  173  U.  S.  615,  "Spoliation 
under  the  guise  of  exerting  the  power  to  tax."  And,  second,  it 
provides  no  opportunity  for  a  hearing  of  the  aggrieved  taxpayer 
concerning  the  proper  amount  of  rent  to  be  charged,  to  correct 
errors,  or  for  an  appeal.  The  existing  law  respecting  hearings 
before  the  Equalization  Board  cannot  apply;  for  that  Board  can 
equalize  only  on  the  basis  of  "full  cash  value,"  which  is  no  longer 
to  be  taxable. 


THIS  BOOK  IS  DUE  ON  THE  I^ST  DATE 
STAMPED  BELOW 


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APR  18  1939 


fC  201882 


4P» 


APfi  22 
JUL  21  1342 


*W8  21  ml         WAV    8  t940 
OCT   19^343 


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